Abstract
Characteristics of national cultures have frequently been claimed to influence the selection of entry modes. This article investigates this claim by developing a theoretical argument for why culture should influence the choice of entry. Two hypotheses are derived which relate culture to entry mode choice, one focusing on the cultural distance between countries, the other on attitudes towards uncertainty avoidance. Using a multinomial logit model and controlling for other effects, the hypotheses are tested by analysing data on 228 entries into the United States market by acquisition, wholly owned greenfield, and joint venture. Empirical support for the effect of national culture on entry choice is found.
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*Bruce Kogut is a Visiting Professor at the Institute of International Business at the Stockholm School of Economics and is on leave from the Wharton School.
**Harbir Singh is an Associate Professor of Management at the Wharton School of Business. His prior research is on corporate acquisitions and on top management incentives, and has been published in the Academy of Management Journal and the Strategic Management Journal.
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Kogut, B., Singh, H. The Effect of National Culture on the Choice of Entry Mode. J Int Bus Stud 19, 411–432 (1988). https://doi.org/10.1057/palgrave.jibs.8490394
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DOI: https://doi.org/10.1057/palgrave.jibs.8490394