The Effect of National Culture on Management Control and Incentive System Design in Multi-Business Firms: Evidence of Intracorporate Isomorphism
Posted: 26 May 2003
This paper examines whether variations in national culture at the business-unit level of multi-business firms that operate internationally trigger adjustments in the corporate management control and incentive systems (MCISs) to fit local business-unit circumstances. Although the results show that selected MCIS-characteristics are attuned to business-unit national culture, further analysis of multi-level data reveal small business-unit effects relative to corporate effects. The presence of dominant corporate effects suggests that MCISs tend to be uniformly implemented within firms, rather than to reflect local business-unit conditions.
Keywords: management control systems, incentive systems, national culture, intracorporate isomorphism
JEL Classification: M40, M46, M47
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