The Relationship Between Psychic and Cultural Distance and Business Ethicality Attitudinal Values of Future Business Leaders

ABSTRACT

Psychic distance and cultural distance between countries are phenomena that can affect a company's entry strategy into foreign markets, as can differences in levels of business ethicality. The author examines the use of three measures of psychic and/or cultural distance (Brewer, 2007; Ellis, 2008; Fletcher & Bohn, 1998) and assesses the extent to which they are related to business ethicality values. A two-stage sampling design was used to survey undergraduate business students in 23 countries regarding their business-related ethics attitudes. This study had 13 countries in common with the Brewer (2007) and Fletcher and Bohn (1998) studies and 12 countries in common with Ellis (2008). Comparisons were made between the index values of the countries and their average scores on a scale of business ethicality by correlation analysis. Correlations were not statistically significant. The results suggest that none of the measures of distance examined is a good indicator of business ethicality and vice versa. Thus, one cannot assume a priori that a country that is culturally or psychically close to one's own country will have similar business ethicality values.     

The Impact of Psychic Distance on the Internationalisation of the Australian Firm

Abstract

This paper explores the relationship between management characteristics and psychic distance, psychic distance and internationalisation and management characteristics and internationalisation. It is argued that internationalisation takes different forms and that psychic distance will impact differently on each form whether it is outward, inward or linked. It is shown that whereas some management characteristics impact on internationalisation directly, others have impact through psychic distance acting as an intervening variable. The management implications for the above are discussed, as is its effect on planning future international activities.     

The Psychic Distance Postulate Revised: From Market Selection to Speed of Market Penetration

In this paper we revise the psychic distance postulate of the Uppsala Model (Johanson and Vahlne, 1977, 1990) by injecting more recent findings (i.e., distinguishing between selection of foreign markets and time needed to achieve sufficient penetration in foreign markets and the role of social capital). The model we propose posits that a higher psychic distance decreases the speed of market penetration. On distant markets, internationalizing technology-based ventures need more time to establish a position in the foreign network and to obtaining positive cash flow. Our model presents social capital as a mean to overcome the psychic distance and to increase the speed of market penetration. We build our model on four case studies on technology-based new ventures internationalizing at very early ages.     

The Effect of Cultural Distance on International Marketing Strategy: A Comparison of Cultural Distance and Managerial Perception Measures

ABSTRACT

The purpose of this article is to examine whether service convenience increases customer satisfaction that fosters customer loyalty in Indian commercial banks. A cross-sectional study of 352 retail banking customers through questionnaires was conducted. The population of the study is retail urban customers of banks in Rajasthan. Responses are analyzed using structural equation modeling. Dimensions of service convenience are decision convenience, access convenience, transaction convenience, benefit convenience, and postbenefit convenience. Decision convenience was found to influence customer satisfaction more than the other dimensions of service convenience. Customer satisfaction furthers customer loyalty. The article emphasizes the significance of SERVCON on customer satisfaction for the Indian banking sector. The direct impact of SERVCON on customer loyalty is also studied.     

The Influence of Regionalization and Cultural Distance on the Direction of Exports

Research has identified two distinct influences on the direction of firm internationalisation, cultural distance, and regionalisation. This paper sets out to test the strength of these influences on the direction of exports in circumstances where they act in different directions. The paper applies a quantitative methodology to a large, purposively compiled data set of Australian export values over the period 1990 to 2004. The Australian context provides an interesting case because its cultural linkages and its geographic connections lie in different directions. It is shown that regionalisation is the dominant influence on the direction of exports in the Australian context.     

Cultural distance and the choice between wholly owned subsidiaries and joint ventures

Most empirical research on the choice between joint ventures and wholly owned subsidiaries analyzes the role of cultural distance in an isolated way. This study explores the potential influence of some factors related to the diversity among countries that are traditionally associated with cultural distance but not explicitly included in measurements of cultural distance. Different approaches to and measurements of cultural distance are used in this analysis. This study examines the potential existence of a moderating or intensifying effect of third variables on the role played by cultural distance. The results confirm the contingent role of host country risk on the choice between equity joint ventures and wholly owned subsidiaries.     

Alignment of strategy and structure in international firms: An empirical examination

It is increasingly recognized that many multinationals face dual global and local pressures. Foreign subsidiaries are thus expected to exhibit different needs in terms of their internal integration or responsiveness to local needs. This study examines the internal alignment of strategy and structure in multinationals when such dual pressures are recognized. The findings show a lower than expected level of internal strategy–structure alignment. A number of post hoc interviews suggest that contrary to the discussion of differences across foreign subsidiaries’ external environments, dual global and local pressures are frequently experienced within the same foreign subsidiary. The balancing act of aligning strategy and structure in MNCs is thus more complex than existing theoretical frameworks predict. Multinationals may choose to prioritize selective structural characteristics to achieve sufficient levels of both integration and responsiveness.     

Clusters,knowledge spillovers and new venture performance: An empirical examination

Firms in geographic regions with industry clustering have been hypothesized to possess performance advantages due to superior access to knowledge spillovers. Yet, no prior studies have directly examined the relationship between a firm's location within a cluster, knowledge spillovers and firm performance. In this study, we examine whether technological spillovers explain the performance of new ventures in cluster regions. We find that ventures located within geographic clusters absorb more knowledge from the local environment and have higher growth and innovation performance, but contrary to conventional wisdom, technological spillovers are not the contributing cause of higher performance observed for these firms.     

Price adjustment strategy under conditions of high inflation: An empirical examination

Price adjustment strategy is a central problem to businesses operating under conditions of high inflation. Three different approaches to the problem are presented and some of their implications tested empirically by means of a unique data set. The empirical observations do not support any of the three traditional approaches.     

An empirical examination of performance in the clothing retailing industry: A case study

This article estimates the efficiency of the 40 retail stores of a prestigious clothing company that operates in the Portuguese fast-fashion retailing market. The study compares the performance among the stores and provides insights into ways of improving performance in the retail clothing industry. A two-stage approach is used in this article. In a first stage, Data Envelopment Analysis (DEA) techniques are used to evaluate the performance of each store and to rank the stores. The input-oriented model was used to assess the summer and winter collections between 2010 and 2013. The results show that the total technical efficiency of the company decreases over time. Except for the year 2013, over 90% of the stores show increasing returns to scale during 88% of the period analyzed. The company faces a clear problem of productivity in its retailing operations. This deficiency seems to be intrinsic to the firm as it involves more than 60% of the stores. In a second stage, a quantile regression technique was used. This showed primarily that for the lowest quantiles of the efficiency score conditional distribution the coefficients on experience are very low, even close to zero, which suggests that the efforts taken by the stores in terms of experience are barely recognized by consumers in this fast-fashion retailing chain.     

An empirical examination of three machiavellian concepts: Advertisers vs. the general public

This paper examines the perceived ethics of advertisers and the general public relative to three ethical concepts. Based on the survey findings, it can be concluded that with regard to the ethically-laden concepts of manipulation, exploitation, and deviousness, advertisers are perceptually as ethical as the general public. The research also clarifies some of the differences between ethics and Machiavellianism.John P. Fraedrich is an Assistant Professor of Marketing at Southern Illinois University at Carbondale. Dr. Fraedrich's teaching and research interests are primarily in the areas of business ethics, international channels, strategy, and theory. His recently completed dissertation was entitled Philosophy Type Interaction in the Ethical Decision Making Process of Retailers. O. C. Ferrell is the Distinguished Professor of Marketing and Business Ethics in the Fogelman College of Business and Economics at Memphis State University. Dr. Ferrell is the author of articles in the Journal of Marketing, Journal of Marketing Research, Journal of Business Research, Journal of the Academy of Marketing Science, Journal of Advertising, Journal of Risk and Insurance, Journal of Consumer Affairs, Journal of Health Care Marketing, as well as others. He is co-author of Marketing: Concepts and Strategies, 6th ed., Marketing Strategy and Plans, 3rd ed., and Business. William M. Pride is a Professor of Marketing at Texas A&M University. Dr. Pride's teaching and research interests are primarily in the areas of consumer behavior, promotion, and advertising. He has written several books and has published numerous articles in a variety of journals including the Journal of Marketing, Journal of Marketing Research, Journal of Retailing, and the Journal of Advertising.     

社会距离与口碑传播效力研究:解释水平的视角

本文从社会心理学解释水平理论的视角出发,以购买意愿测量口碑传播效果,发现随着社会距离的延伸,口碑传播效果降低,提高口碑信息的目标价值、目标可得性将增强口碑传播效果;在社会距离较近的强关系下,增强目标可得性可更好地提升口碑传播效果,而在社会距离较远的弱关系下,提高目标价值则能更有效地改善口碑传播效果。     

Institutional ownership of stock and dimensions of corporate social performance: An empirical examination

Collectively, institutions own an increasing proportion of outstanding corporate equities. As an emergent force in shaping corporate America, the linkages between institutional ownership and corporate social performance (CSP) require empirical examination. Not only do corporate policy makers need to know those areas where social performance may lure or inhibit capital infusions, lawmakers also need a better understanding of the social forces guiding corporate policy. As anticipated, this study found a positive relationship between the amount of institutional ownership of corporate stock and a company's social responsiveness as measured by the representation of women on its board of directors; however, no statistically significant relationship with social responsibility as measured by charitable giving was found. The exemplar of social issues management — compliance with the Sullivan principles — showed an unexpected, negative relationship with the level of institutional ownership.Betty S. Coffey's research interests are in the area of strategic management, organizational change, and social issues.Gerald E. Fryxell is Assistant Professor of Management at the University of Tennessee, Knoxville. His current research interests are in the area of corporate culture, innovation, and strategic management.     

An empirical examination of clustering and dispersion within Canadian shopping centers

In this paper, data on the internal compositions of 90 planned regional shopping centers in the five westernmost provinces in Canada are used to examine the locational pattern of stores in shopping centers, to see whether these locations are consistent with exploiting demand externalities and the physical features of the mall. The empirical relevance of so-called “rules of thumb” for locating stores in shopping centers is also assessed. We find that there is clustering of service stores near mall entrances, and clustering of comparison shopping stores near corridor intersections and on the second floor of two-story malls. Clustering tends to occur in the ladies' wear, jewellery/fashion accessory, and unisex clothing store categories, facilitating comparison shopping. Clustering of stores in the service category facilitates multipurpose shopping. A regression analysis indicates that clustering may depend upon the size, age, and type of mall in question. Overall, results are consistent with consumer transportation/shopping costs and demand externalities driving the internal store location strategy of planned regional shopping centers.     

An empirical examination of the informational content of credit ratings in China

We examine the certification effect of initial rating announcements and the signaling effect of rating downgrade announcements in China using a pooled time-series cross-sectional issuer rating data of 170 companies listed on the Shanghai and Shenzhen Stock Exchanges from 2002 to July 2006. The empirical evidence supports our hypothesis of an asymmetric certification effect. Consistent with the literature, we also find some negative signaling effects in our rating downgrade sub-sample. Overall, although there are some qualitative arguments that credit ratings in China do not have information content, our empirical findings suggest otherwise. When a normally positively biased rating agency gives a low rating, it is valuable news to market participants.     

Modeling price-related consequences of the brand origin cue: An empirical examination of the automobile market

Price-related consequences of the country-of-origin (COO) cue have been widely neglected in the literature. This paper applies hedonic price analysis to examine a brand’s COO effect on new car prices. The application of our models to an extensive dataset demonstrates that prices of new cars reflect not only implicit prices of performance and technological characteristics but also price distortions that arise out of COO heterogeneity. Moreover, by allowing model parameters to vary across car type segments, we are able to capture patterns of differential attribute and COO effects on prices, which are indicative of implicit price discrimination strategies. The paper provides new interesting insights into critical issues for pricing strategy and demonstrates the role of brand origin, segments, and observed product differences in the price structure of the automobile market. Our findings yield important implications for manufacturers and researchers.     

The FDI location decision: Distance and the effects of spatial dependence

We investigate how different conceptions of distance impact upon one of the fundamental decisions made by foreign investors, the choice of foreign direct investment (FDI) location within the selected host country. We argue that the attractiveness of host country locations to foreign investors depends not only upon location-specific attributes such as labor costs, but also upon the location's proximity to alternative locations. We provide theoretical rationales for how and why alternative concepts of distance might impact upon firms’ FDI location decisions, and explicitly model different measures of geographic, economic and administrative distance. Empirically we illustrate the use of a number of spatial regression models with a new dataset on FDI in Chinese prefecture-cities, and have shown, in this context, that geographic distance is not the ‘best’ measure of distance to use. We find clear evidence of spatial dependence between the cities based upon economic distance, with weaker evidence related to administrative distance. The distinctive contribution of this paper is to emphasize that city-level policy to attract FDI is more likely to succeed if the prefecture-city is economically (and administratively) close to alternative city locations, while any policy expenditure may fail to attract FDI inflows if the prefecture-city is distant from other city locations.     

Antecedents and consequences of global responsiveness: An empirical examination of MNCs in the global sourcing context

As global responsiveness (GR) has been recognised as critical for global market advantage, we draw upon social capital theory and develop a theoretical model which clarifies the determinants and consequences of GR. Based upon a cross-national sample of 118 MNCs from the U.S., Europe, and Asia, we found that intra-firm structural and inter-firm relational social capital, as reflected in integrative mechanisms and joint problem solving respectively, are positively associated with GR. In addition, whilst negatively related to global sourcing barriers, GR has a positive effect on MNC performance. Our findings also indicate that GR plays an essential role by fully mediating the associations of information-based mechanisms, people-based mechanisms, and joint problem solving with global sourcing barriers and MNC performance.     

The management perception of the strategic outsourcing of services: An empirical examination in the hotel sector

This work will analyse the strategy of outsourcing, or the predisposition on the part of a firm to entrust some of its services to a third party. The research will focus on discovering empirically the role that this strategy plays in hotels, and in order to do this we will carry out an analysis of hotel managers' perceptions regarding outsourcing based on the main advantages as well as the drawbacks and barriers which using the strategy can involve, with a view to determining which of these are related to a predisposition to outsource. The results of the research suggest that the main reasons which determine outsourcing are of a strategic rather that cost-reducing nature. Despite the fact that although current outsourcing is conditioned by the cost factor alone, any future increase in the use of the strategy will be determined exclusively by factors of a strategic nature. With respect to the disadvantages of outsourcing which tend to limit the use of the strategy, we will see that these are related to loss of control and autonomy together with a distrust of external suppliers. This work will enable us to assess the extent of the existing demand for outsourcing main services as well as those factors which determine and limit the outsourcing strategy and which have prevented a large number of services where outsourcing would be applicable from being outsourced to the present date. Finally we will present our main conclusions and recommendations.     

互联网发展对我国文化出口贸易影响的实证分析

随着近年来互联网经济的快速发展,我国也在开展文化出口贸易的过程中融合了互联网,基于互联网的时代背景下,通过对2009—2018年我国与30个周边国家文化出口贸易的面板数据进行实证分析,结果显示:在我国文化出口贸易的影响因素中,贸易国双方的互联网使用人数对我国文化贸易产品出口有显著的正向影响。