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The influence of culture and framing on investment decision-making

The influence of culture and framing on investment decision-making Cultural studies in business and economics research are still limited to particular cultures. Knowledge on cultural differences may help international corporations to adapt management practices according to the markets they are operating in. The purpose of this paper is to study the issue of escalation of commitment and framing in a new cultural setting involving Germany and Vietnam. This setting is unique and particularly interesting, for Germany being the biggest European market and Vietnam being one of the fastest growing emerging markets in Asia.Design/methodology/approachThe authors use a lab experiment with student participants from Germany and Vietnam.FindingsIn a 2×2 in between-experiment, the authors find strong support that Vietnamese participants have a stronger tendency to invest additional resources and evidence that negatively framed information leads to the higher escalation of commitment. Implications are discussed.Originality/valueThe unique empirical comparison is important because differences between other western and eastern countries do not necessarily generalize to the setting. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Cross Cultural & Strategic Management Emerald Publishing

The influence of culture and framing on investment decision-making

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2059-5794
DOI
10.1108/ccsm-10-2017-0139
Publisher site
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Abstract

Cultural studies in business and economics research are still limited to particular cultures. Knowledge on cultural differences may help international corporations to adapt management practices according to the markets they are operating in. The purpose of this paper is to study the issue of escalation of commitment and framing in a new cultural setting involving Germany and Vietnam. This setting is unique and particularly interesting, for Germany being the biggest European market and Vietnam being one of the fastest growing emerging markets in Asia.Design/methodology/approachThe authors use a lab experiment with student participants from Germany and Vietnam.FindingsIn a 2×2 in between-experiment, the authors find strong support that Vietnamese participants have a stronger tendency to invest additional resources and evidence that negatively framed information leads to the higher escalation of commitment. Implications are discussed.Originality/valueThe unique empirical comparison is important because differences between other western and eastern countries do not necessarily generalize to the setting.

Journal

Cross Cultural & Strategic Management – Emerald Publishing

Published: Oct 31, 2018

Keywords: Framing; Escalation of commitment; Lab experiment; Investment decision-making

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