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The International Headquarters–Subsidiary Relationship: Projecting Economic Cultural Influences on Management within Selected EU Countries

Author

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  • Rune Gulev

    (Reutlingen Fachhochschule, Germany)

Abstract

Through the recent European Union (EU) enlargement it is now supposed that there exists significant divergence within European economic cultures that can negatively impact international managerial functions. This article systematically investigates two dimensions through which economic culture can be measured and compared between four EU countries: Slovenia, a new Central European entrant into the EU, and Germany, Austria and Denmark, three westernized EU members, and projects their respective impacts onto several international management functions. The findings suggest that there exists a strong link between highly interpersonal and institutional trust driven economic cultures (IITDEC) to induce increased horizontal knowledge sharing. Further evidence was found, although statistically weaker, that IITDEC is negatively correlated to expatriate utilization. Results were also obtained regarding authority driven economic cultures (ADEC). A negative correlation between ADEC and decentralization was established as well as a negative correlation between ADEC and vertical knowledge flows.

Suggested Citation

  • Rune Gulev, 2007. "The International Headquarters–Subsidiary Relationship: Projecting Economic Cultural Influences on Management within Selected EU Countries," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 5(1), pages 63-83.
    • Handle: RePEc:mgt:youmgt:v:5:y:2007:i:1:p:063-083
    as

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    References listed on IDEAS

    as
    1. Milan Zver & Tjasa Zivko & Vito Bobek, 2004. "Is There a Gap in Economic Culture Between EU Countries and the Transition Economies?," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 2(1), pages 31-40.
    2. Matjaz Novak, 2003. "Analysis of the Nature of Economic Growth of Slovenian Economy," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 1(2), pages 153-167.
    3. Klarsfeld, Alain & Mabey, Christopher, 2004. "Management Development in Europe:: Do National Models Persist?," European Management Journal, Elsevier, vol. 22(6), pages 649-658, December.
    4. Volker Mahnke & Torben Pedersen, 2004. "Knowledge Governance and Value Creation," Palgrave Macmillan Books, in: Volker Mahnke & Torben Pedersen (ed.), Knowledge Flows, Governance and the Multinational Enterprise, chapter 1, pages 3-17, Palgrave Macmillan.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    economic culture; headquarter–subsidiary relationship; international management;
    All these keywords.

    JEL classification:

    • Z10 - Other Special Topics - - Cultural Economics - - - General
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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