The impact of manager's animosity and ethnocentrism on multinational enterprise (MNE) international entry‐mode decision

Abstract

For MNEs, entry-mode decision is undeniably critical. While the literature has identified several determinants of foreign entry-mode choice, few have examined the impact of manager's animosity and ethnocentrism. This article is an attempt to fill this gap by examining the independent effect of manager animosity and ethnocentrism as well as the moderating effect of cultural intelligence on entry mode. Data were collected through surveys targeting upper-level managers in the U.S., U.K., and Germany to examine how animosity and ethnocentrism would shape their decision to enter Iran, a host market largely perceived negatively in the West. Multivariate multiple regression was used to test the hypothesized effects and to capture the multidimensional aspect of entry modes. We found that, in general, manager's animosity and ethnocentrism do negatively affect the choice of an entry mode and that cultural intelligence has the potential to neutralize that negative effect.