The Impact of Institutional Distance on the International Diversity-Performance Relationship

Chao, Mike Chen-Ho; Kumar, Vikas

doi:10.2139/ssrn.1365094

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The Impact of Institutional Distance on the International Diversity-Performance Relationship

41 Pages Posted: 22 Mar 2009

See all articles by Mike Chen-Ho Chao

Mike Chen-Ho Chao

City University of New York (CUNY) - Allen G. Aaronson Department of Marketing & International Business

Vikas Kumar

The University of Sydney Business School

Date Written: March 19, 2009

Abstract

We investigate the impact of institutional distance on the international diversity-performance relationship. We first discuss the international diversity-performance relationship for large multinational firms and later show the moderation effect of regulative and normative institutional distance. Based on a sample of Fortune 500 firms, we find that the posited relationship is depicted by an inverted U-shaped curve. Regulative institutional distance has a negative moderating effect on the international diversity-performance relationship while normative institutional distance shows a positive effect.

Keywords: Institutional Distance, International Diversity, Performance

Suggested Citation: Suggested Citation

Chao, Mike Chen-Ho and Kumar, Vikas, The Impact of Institutional Distance on the International Diversity-Performance Relationship (March 19, 2009). Available at SSRN: https://ssrn.com/abstract=1365094 or http://dx.doi.org/10.2139/ssrn.1365094