The Asymmetric Utility of Cultural Distance in International Business based on the Cultural Bias

Abstract

As an index to measure the cultural differences between countries, culture distance (CD) is a widely used construct in international business and postulated to be symmetric in previous studies. However, CD symmetry across different countries is been demonstrated to result in the national CD paradox. A new asymmetry index utility cultural distance (UCD) is proposed to replace the previous one in this study. The cultural utility function is applied to calculate the UCD for a particular country, where the cultural bias could cause the asymmetric change of cultural score. The index is verified to be a significant variable in the regression analysis of China’s outward foreign directing investment to 17 other countries in 15 years. The UCD demonstrated in this paper corrects the fallacious symmetry assumption on cultural distance and can maintain a consistent and effective conclusion on cultural differences in international business studies.

CEO international experience and firm performance revisited: What’s culture got to do with it?

“…According to Zaheer et al (2012), without considering the institutional context of the respective locations, research merely addresses how much two cultures differ but does not address how they differ. This notion was first advanced by Shenkar (2001), who called the assumption of identical distances in both directions an “illusion”, now referred to as the fallacy of symmetry assumption (Correa de Cunha et al ., 2022; Fu et al , 2022).…”

Retracted: The Asymmetric Utility of Cultural Distance in International Business based on the Cultural Bias

“…Tis article has been retracted by Hindawi following an investigation undertaken by the publisher [1]. Tis investigation has uncovered evidence of one or more of the following indicators of systematic manipulation of the publication process:…”