| Abstract: | Opportunistic behavior has been the main threat in cross-cultural supply chains. Drawing on institutional theory, we investigated how Chinese export firms facing cultural differences reduce foreign distributors' opportunism through differentiated contract governance strategies. Based on both a survey dataset of 206 Chinese export firms and a secondary dataset, our results suggest that cultural distance increases opportunism by inhibiting contract application but also decreases opportunism by enhancing detailed contract design. In addition, we found that both indirect effects of cultural distance on opportunism via contract governance strategies depend on the surrounding institutional environment in cross-cultural supply chains. Regulatory uncertainty strengthens the positive impact of cultural distance on detailed contract design and strengthens the negative impact of cultural distance on contract application. Moreover, regulatory uncertainty also strengthens the negative impact of detailed contract design on opportunism and weakens the negative impact of contract application on opportunism. |
