This paper studies if 'cultural distance' between two firms determines the entry mode of a foreign organization. We study two different modes of entering a market: cooperative agreements and acquisitions. We analyze a database that gathers 1,292 cooperative ventures and acquisitions in ten Latin...

Casual observation suggests that cultural differences play an important role in business transactions, yet systematic evidence on this relationship is scarce. This paper provides a novel investigation of the effect of cultural distance on multinational firms’ decisions to integrate their...