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Understanding Compensation Practice Variations Across Firms: The Impact of National Culture

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  • Randall S Schuler

    (New York University)

  • Nikolai Rogovsky

    (California State University)

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    Abstract

    With operations spread worldwide, firms that find themselves competing in a global marketplace are looking at the implications of the admonition, “When in Rome. ...” This raises the question: “Do cultures of countries have an impact on the generally accepted methods of managing human resources?” The answer to this question is the focus of this article. By developing culture-specific propositions for four categories of compensation practices based on status, performance, social benefits and programs, and employee ownership plans, we seek to determine the extent to which Hofstede's four dimensions of culture are associated with specific compensation practices. Support is found for most of the propositions. The implications of the finding for the management of human resources by multinational firms are discussed.© 1998 JIBS. Journal of International Business Studies (1998) 29, 159–177

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    Bibliographic Info

    Article provided by Palgrave Macmillan in its journal Journal of International Business Studies.

    Volume (Year): 29 (1998)
    Issue (Month): 1 (March)
    Pages: 159-177

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    Handle: RePEc:pal:jintbs:v:29:y:1998:i:1:p:159-177

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    Cited by:
    1. Fabian Froese, 2013. "Work values of the next generation of business leaders in Shanghai, Tokyo, and Seoul," Asia Pacific Journal of Management, Springer, vol. 30(1), pages 297-315, March.
    2. Hoorn, André van, 2012. "Individualism and the cultural roots of management practices," Research Report 12008-GEM, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    3. Lertxundi Lertxundi, Aitziber, . "Ikuspegi kulturala giza baliabideen zuzendaritzan. Literaturaren berrikuspena eta etorkizunerako erronkak," Revista de Dirección y Administración de Empresas, Universidad del País Vasco - Escuela Universitaria de Estudios Empresariales de San Sebastián.
    4. Volkema, Roger J., 2004. "Demographic, cultural, and economic predictors of perceived ethicality of negotiation behavior: A nine-country analysis," Journal of Business Research, Elsevier, vol. 57(1), pages 69-78, January.
    5. Dikova, Desislava & Rao Sahib, Padma, 2013. "Is cultural distance a bane or a boon for cross-border acquisition performance?," Journal of World Business, Elsevier, vol. 48(1), pages 77-86.
    6. Aggarwal, Raj & Goodell, John W., 2013. "Political-economy of pension plans: Impact of institutions, gender, and culture," Journal of Banking & Finance, Elsevier, vol. 37(6), pages 1860-1879.
    7. Puck, Jonas F & Mohr, Alexander T & Holtbrügge, Dirk, 2006. "Cultural convergence through web-based management techniques? The case of corporate web site recruiting," Journal of International Management, Elsevier, vol. 12(2), pages 181-195, June.
    8. Victor Oltra & Jaime Bonache & Chris Brewster, 2013. "A New Framework for Understanding Inequalities Between Expatriates and Host Country Nationals," Journal of Business Ethics, Springer, vol. 115(2), pages 291-310, June.
    9. Li, Kai & Griffin, Dale & Yue, Heng & Zhao, Longkai, 2013. "How does culture influence corporate risk-taking?," Journal of Corporate Finance, Elsevier, vol. 23(C), pages 1-22.
    10. Slangen, Arjen H.L., 2006. "National cultural distance and initial foreign acquisition performance: The moderating effect of integration," Journal of World Business, Elsevier, vol. 41(2), pages 161-170, June.
    11. Karartı, Tuncay, 2014. "Concvergence or Divergence? Analysis of Human Resource Practices in SME Turkey," MPRA Paper 54389, University Library of Munich, Germany, revised 2014.
    12. Johnson, James P. & Lenartowicz, Tomasz, 1998. "Culture, freedom and economic growth: Do cultural values explain economic growth?," Journal of World Business, Elsevier, vol. 33(4), pages 332-356, January.
    13. Chiang, Flora F.T. & Birtch, Thomas A., 2005. "A taxonomy of reward preference: Examining country differences," Journal of International Management, Elsevier, vol. 11(3), pages 357-375, September.
    14. Reiche, B. Sebastian, 2008. "The configuration of employee retention practices in multinational corporations' foreign subsidiaries," International Business Review, Elsevier, vol. 17(6), pages 676-687, December.
    15. Haka, Susan F. & Heitger, Dan L., 2004. "International managerial accounting research: A contracting framework and opportunities," The International Journal of Accounting, Elsevier, vol. 39(1), pages 21-69.
    16. Kiessling, Timothy S. & Richey, R. Glenn & Meng, Juan & Dabic, Marina, 2009. "Exploring knowledge management to organizational performance outcomes in a transitional economy," Journal of World Business, Elsevier, vol. 44(4), pages 421-433, October.
    17. Kaufmann, Jeffrey B. & O'Neill, Hugh M., 2007. "Do culturally distant partners choose different types of joint ventures?," Journal of World Business, Elsevier, vol. 42(4), pages 435-448, December.
    18. Cravens, Karen S. & Oliver, Elizabeth Goad, 2000. "The Influence of Culture on Pension Plans," The International Journal of Accounting, Elsevier, vol. 35(4), pages 521-537, 010.
    19. Chang, Kiyoung & Noorbakhsh, Abbas, 2009. "Does national culture affect international corporate cash holdings?," Journal of Multinational Financial Management, Elsevier, vol. 19(5), pages 323-342, December.

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