Original scientific paper
https://doi.org/10.1080/1331677X.2023.2180415
Does culture diversity affect innovation? Evidence from Chinese business group affiliated firms
Hui Xu
Bo Cheng
Qiaoling Fang
Abstract
We analyze how intra-group culture diversity affect group affiliated
firm’s innovation. Our findings suggest that the more inconsistency
on risk preference among affiliated firms in one group,
the less impact of affiliated firm’s own risk culture on innovation.
Specifically, we document that intra-group culture diversity
impedes individual affiliated firm’s innovation through managerial
and controlling agency problems. The heterogeneity test shows
that size, executives, headquarter connected, location, state ownership
and information quality of affiliated firms can affect intragroup
culture diversity on innovation. We prove that intra-group
culture diversity impedes innovation on group affiliated firms,
which means a dark side of business group affiliation.
Keywords
Culture diversity; business group; innovation; collectivism; individualism
Hrčak ID:
306542
URI
Publication date:
31.3.2023.
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