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An institutional approach to cross-national distance

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Author Info

  • Heather Berry

    (Management Department, The Wharton School, University of Pennsylvania, Philadelphia, USA)

  • Mauro F Guill�n

    (Management Department, The Wharton School, University of Pennsylvania, Philadelphia, USA)

  • Nan Zhou

    (Management Department, The Wharton School, University of Pennsylvania, Philadelphia, USA)

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Abstract

Cross-national distance is a key concept in the field of management. Previous research has conceptualized and measured cross-national differences mostly in terms of dyadic cultural distance, and has used the Euclidean approach to measuring it. In contrast, our goal is to disaggregate the construct of distance by proposing a set of multidimensional measures, including economic, financial, political, administrative, cultural, demographic, knowledge, and global connectedness as well as geographic distance. We ground our analysis and choice of empirical dimensions on institutional theories of national business, governance, and innovation systems. In order to overcome the methodological limitations of the Euclidean approach, we calculate dyadic distances using the Mahalanobis method, which is scale-invariant and takes into consideration the variance–covariance matrix. We empirically analyze four different foreign expansion choices of US companies to illustrate the importance of disaggregating the distance construct and the usefulness of our distance calculations, which we make freely available to managers and scholars.

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Bibliographic Info

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

Volume (Year): 41 (2010)
Issue (Month): 9 (December)
Pages: 1460-1480

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Handle: RePEc:pal:jintbs:v:41:y:2010:i:9:p:1460-1480

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Cited by:
  1. Julien Gooris & Carine Peeters, 2013. "Home-Host Country Distance in Offshore Governance Chocies," Working Papers ECARES ECARES 2013-13, ULB -- Universite Libre de Bruxelles.
  2. Barros, Henrique M., 2011. "The Effects of Innovation Partnership, Foreign Ownership and Enhanced Management Practices on the Use of Patents in Brazilian Manufacturing," Insper Working Papers wpe_255, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
  3. Ambos, Björn & Håkanson, Lars, 2014. "The Concept of Distance in International Management Research," Journal of International Management, Elsevier, vol. 20(1), pages 1-7.
  4. van Veen, Kees & Sahib, Padma Rao & Aangeenbrug, Evelien, 2014. "Where do international board members come from? Country-level antecedents of international board member selection in European boards," International Business Review, Elsevier, vol. 23(2), pages 407-417.
  5. Nebus, James & Chai, Kah Hin, 2014. "Putting the “psychic” Back in Psychic Distance: Awareness, Perceptions, and Understanding as Dimensions of Psychic Distance," Journal of International Management, Elsevier, vol. 20(1), pages 8-24.
  6. Hutzschenreuter, Thomas & Kleindienst, Ingo & Lange, Sandra, 2014. "Added Psychic Distance Stimuli and MNE Performance," Journal of International Management, Elsevier, vol. 20(1), pages 38-54.
  7. Cláudia Frias Pinto & Fernando Ribeiro Serra & Manuel Portugal Ferreira, 2014. "A bibliometric study on culture research in International Business," Working Papers 107, globADVANTAGE, Polytechnic Institute of Leiria.

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