Skip to main content
SpringerLink
Log in

Formal and Informal Institutional Differences Between Home and Host Country and Location Choice: Evidence from the Spanish Hotel Industry

  • Research Article
  • Published:
Management International Review Aims and scope Submit manuscript

Abstract

Using secondary data of internationalized Spanish hotel chains, this research attempts to examine the role of formal and informal institutional differences between home and host country from the foreign location choice point of view. Generally speaking, the results show that (a) the higher the formal institutional differences the lower the attractiveness of the foreign location, (b) the negative effect of linguistic differences, as an informal institutional dimension, significantly affects the choice of location, and (c) the moderating role of linguistic differences between formal institutional factors with regards to the choice of location is contrary to our expectations. Based on the findings, this work wishes to offer not just a better understanding of the location choice decisions within the service industry but also to identify both the joint effect of formal and informal institutional factors as well as to distill their individual effects. This is of relevance since there seem to be no conclusive empirical evidence of such effects so far in the literature.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Source: Authors’ own work

Fig. 2

Similar content being viewed by others

References

  • Agarwal, J. P. (1980). Determinants of foreign direct investment: A survey. Review of World Economics, 16(4), 739–773.

    Google Scholar 

  • Ajami, R., & BarNiv, R. (1984). Utilizing economic indicators in explaining foreign direct investment in the U.S. Management International Review, 24(4), 16–26.

    Google Scholar 

  • Ambos, T. C., & Ambos, B. (2009). The impact of distance on knowledge transfer effectiveness in multinational corporations. Journal of International Management, 15(1), 1–14.

    Google Scholar 

  • Arregle, J. L., Miller, T. L., Hitt, M. A., & Beamish, P. W. (2013). Do regions matter? An integrated institutional and semiglobalization perspective on the internationalization of MNEs. Strategic Management Journal, 34(8), 910–934.

    Google Scholar 

  • Arslan, A., & Larimo, J. (2011). Greenfield investments or acquisitions: Impacts of institutional distance on establishment mode choice of multinational enterprises in emerging economies. Journal of Global Marketing, 24(4), 345–356.

    Google Scholar 

  • Avloniti, A., & Filippaios, F. (2014). Unbundling the differences between psychic and cultural distance: An empirical examination of the existing measures. International Business Review, 23(3), 660–674.

    Google Scholar 

  • Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.

    Google Scholar 

  • Berry, H., Guillén, M. F., & Zhou, N. (2010). An institutional approach to cross-national distance. Journal of International Business Studies, 41(9), 1460–1480.

    Google Scholar 

  • Beugelsdijk, S., Kostova, T., Kunst, V. E., Spadafora, E., & Essen, M. (2018). Cultural distance and firm internationalization: A meta-analysis review and theoretical implications. Journal of Management, 44(1), 89–130.

    Google Scholar 

  • Bevan, A., Estrin, S., & Meyer, K. (2004). Foreign investment location and institutional development in transition economies. International Business Review, 13(1), 43–64.

    Google Scholar 

  • Blanc-Brude, F., Cookson, G., Piesse, J., & Strange, R. (2014). The FDI location decision: Distance and the effect of spatial dependence. International Business Review, 23(4), 797–810.

    Google Scholar 

  • Brewer, P. A. (2007). Operationalizing psychic distance: A revised approach. Journal of International Marketing, 15(1), 44–66.

    Google Scholar 

  • Brockman, P., Rui, O. M., & Zou, H. (2013). Institutions and the performance of politically connected M&As. Journal of International Business Studies, 44(8), 833–852.

    Google Scholar 

  • Brouthers, K. D. (2002). Institutional cultural and transaction cost influences on entry mode choice and performance. Journal of International Business Studies, 33(2), 203–221.

    Google Scholar 

  • Brouthers, K. D., & Bamossy, G. J. (1997). The role of key stakeholders in international joint venture negotiations: Case studies from Eastern Europe. Journal of International Business Studies, 28(2), 285–308.

    Google Scholar 

  • Bruton, G. D., Ahlstrom, D., & Puky, T. (2009). Institutional differences and the development of entrepreneurial ventures: A comparison of the venture capital industries in Latin America and Asia. Journal of International Business Studies, 40(5), 762–778.

    Google Scholar 

  • Buckley, P. J., Devinney, T., & Louviere, J. J. (2007). Do managers behave the way theory suggests? A choice-theoretic examination of foreign direct investment location decision making. Journal of International Business Studies, 38(7), 1069–1094.

    Google Scholar 

  • Buckley, P. J., & Ghauri, P. N. (2004). Globalization economic geography and the strategy of multinational enterprises. Journal of International Business Studies, 35(2), 81–98.

    Google Scholar 

  • Chakrabarti, A., & Mitchell, W. (2016). The role of geographic distance in completing related acquisitions: Evidence from U.S. chemical manufacturers. Strategy Management Journal, 37(4), 673–694.

    Google Scholar 

  • Chang, S. J., & Park, S. (2005). Types of firms generating network externalities and MNCs’ co-location decisions. Strategic Management Journal, 26(7), 595–615.

    Google Scholar 

  • Chang, S. J., & Rosenzweig, P. M. (2001). The choice of entry mode in sequential foreign direct investment. Strategic Management Journal, 22(8), 747–776.

    Google Scholar 

  • Chen, J., Sokal, R. R., & Ruhlen, M. (1995). Worldwide analysis of genetic and linguistic relationships of human populations. Human Biology, 67(4), 595–612.

    Google Scholar 

  • Chidlow, A., Holmström-Lind, C., Holm, U., & Tallman, S. (2015). Do I stay or do I go? Sub-national drivers for post-entry subsidiary development. International Business Review, 24(2), 266–274.

    Google Scholar 

  • Chidlow, A., Plakoyiannaki, E., & Welsh, C. (2014). Translation in cross-language international business research: Beyond equivalence. Journal of International Business Studies, 45(5), 562–582.

    Google Scholar 

  • Chidlow, A., Salciuviene, L., & Young, S. (2009). Regional determinants of inward FDI distribution in Poland. International Business Review, 18(2), 119–133.

    Google Scholar 

  • Child, J., & Marinova, S. (2014). The role of contextual combinations in the globalization of Chinese firms. Management and Organization Review, 10(3), 347–371.

    Google Scholar 

  • Child, J., Rodrigues, S. B., & Frynas, J. G. (2009). Psychic distance, its impact and coping modes interpretations of SME decision makers. Management International Review, 49(2), 199–224.

    Google Scholar 

  • Cho, K. R., & Padmanabhan, P. (2005). Revisiting the role of cultural distance in MNC’s foreign ownership mode choice: The moderating effect of experience attributes. International Business Review, 14(3), 307–324.

    Google Scholar 

  • Choi, J., & Contractor, F. J. (2016). Choosing an appropriate alliance governance mode: The role of institutional, cultural, and geographical distance in international research and development R&D collaborations. Journal of International Business Studies, 47(2), 210–232.

    Google Scholar 

  • CIA. (2016). The World Factbook 2016. Retrieved April 18, 2017, from https://www.cia.gov/library/publications/the-world-factbook/.

  • Claver, E., Andreu, R., & Quer, D. (2006). Growth strategies in the Spanish hotel sectors: Determining factors. International Journal of Contemporary Hospitality Management, 18(3), 188–205.

    Google Scholar 

  • Contractor, F. J., Lahiri, S., Elango, B., & Kundu, S. K. (2014). Institutional, cultural, and industry related determinants of ownership choices in emerging market FDI acquisitions. International Business Review, 23(5), 931–941.

    Google Scholar 

  • Cuypers, R. P., Ertug, G., & Hennart, J. (2015). The effect of linguistic distance and lingua franca proficiency on the stake taken by acquirers in cross-border acquisitions. Journal of International Business Studies, 46(4), 429–442.

    Google Scholar 

  • Delgado, M., Ketels, C., Porter, M. E., & Stern, S. (2012). The determinants of national competitiveness. NBER Working Paper Series, Working Paper18249. Retrieved April 25, 2017, from http://www.nber.org/papers/w18249.

  • Delios, A., Gaur, A. S., & Makino, S. (2008). The timing of international expansion: Information, rivalry and imitation among Japanese firms. Journal of Management Studies, 45(1), 169–195.

    Google Scholar 

  • Demirbag, M., Glaister, K. W., & Tatoglu, E. (2007). Institutional and transaction cost influences on MNEs’ ownership strategies of their affiliates: Evidence from an emerging market. Journal of World Business, 42(4), 418–434.

    Google Scholar 

  • Dikova, D., Rao, S. P., & Van Witteloostuijn, A. (2010). Cross-border acquisition abandonment and completion: The effect of institutional differences and organizational learning in the international business service industry, 1981–2001. Journal of International Business Studies, 41(2), 223–245.

    Google Scholar 

  • DiMaggio, P., & Powell, W. (1983). The iron cage revisited: Institutional isomorphism and collective rationality on organizations fields. American Sociological Review, 48(2), 147–160.

    Google Scholar 

  • Dow, D., & Ferencikova, S. (2010). More than just national cultural distance: Testing new distance scales on FDI in Slovakia. International Business Review, 19(1), 46–58.

    Google Scholar 

  • Dow, D., & Karunaratna, A. (2006). Developing a multidimensional instrument to measure psychic distance stimuli. Journal of International Business Review, 37(5), 578–602.

    Google Scholar 

  • Dow, D., & Larimo, J. (2011). Disentangling the roles of international experience and distance in establishment mode choice. Management International Review, 51(3), 321–355.

    Google Scholar 

  • Dunning, J. H. (2000). The eclectic paradigm as an envelope for economic and business theories of MNE activity. International Business Review, 9(2), 163–190.

    Google Scholar 

  • Dunning, J. H. (2001). The eclectic (OLI) paradigm of international production: Past, present and future. International Journal of the Economics of Business, 8(2), 173–190.

    Google Scholar 

  • Eden, L., & Miller, S. R. (2004). Distance matters: Liability of foreignness, institutional distance and ownership strategy. In M. A. Hitt & J. L. C. Cheng (Eds.), The evolving theory of the multinational firm. Advances in international management (Vol. 16, pp. 187–221). Oxford: Elsevier.

    Google Scholar 

  • Elango, B., Lahiri, S., & Kundu, S. K. (2013). How does firm experience and institutional distance impact ownership choice in high-technology acquisitions? R&D Management, 43(5), 501–516.

    Google Scholar 

  • Estrin, S., Baghdasaryan, D., & Meyer, K. E. (2009). The impact of institutional and human resource distance on international entry strategies. Journal of Management Studies, 46(7), 1171–1196.

    Google Scholar 

  • Estrin, S., & Prevezer, M. (2011). The role of informal institutions in corporate governance: Brazil, Russia, India, and China compared. Asia Pacific Journal of Management, 28(1), 41–67.

    Google Scholar 

  • Gémar, G., Moniche, L., & Morales, A. J. (2016). Survival analysis of the Spanish hotel industry. Tourism Management, 54, 428–438.

    Google Scholar 

  • Ghemawat, P. (2001). Distance still matters. Harvard Business Review, 79(8), 137–147.

    Google Scholar 

  • Giuliani, E. (2013). Clusters, networks and forms’ product success: An empirical study. Management Decision, 51(6), 1135–1160.

    Google Scholar 

  • Globerman, S., & Shapiro, D. (2003). Governance infrastructure and US foreign direct investment. Journal of International Business Studies, 34(1), 19–39.

    Google Scholar 

  • Godinez, J. R., & Liu, L. (2015). Corruption distance and FDI flows into Latin America. International Business Review, 24(1), 33–42.

    Google Scholar 

  • Goerzen, A., Asmussen, C. G., & Nielsen, B. B. (2013). Global cities and multinational enterprise location strategy. Journal of International Business Studies, 42(5), 427–450.

    Google Scholar 

  • Gooris, J., & Peeters, C. (2014). Home-host country distance in offshore governance choices. Journal of International Management, 20(1), 73–86.

    Google Scholar 

  • Grant, R. M. (1991). The resource-based theory of competitive advantage: Implications for strategy formulation. California Management Review, 33(3), 114–135.

    Google Scholar 

  • Greenwood, R., Suddaby, R., & Hinings, C. R. (2002). Theorizing change: The role of professional associations in the transformation of institutionalized fields. Academy of Management Journal, 45(1), 58–80.

    Google Scholar 

  • Grimes, B. (Ed.). (1992). Ethnologue: Languages of the world (12th ed.). Dallas: Summer Institute of Linguistics.

    Google Scholar 

  • Grosse, R. E., & Trevino, L. J. (1996). Foreign direct investment in the United States: An analysis by country of origin. Journal of International Business Studies, 27(1), 139–155.

    Google Scholar 

  • Håkanson, L., & Ambos, B. (2010). The antecedents of psychic distance. Journal of International Management, 16(3), 195–210.

    Google Scholar 

  • Harzing, A. W. (2003). The role of culture in entry mode studies: From neglect to myopia. Advances in International Management, 15, 75–127.

    Google Scholar 

  • Harzing, A. W., & Pudelko, M. (2016). Do we need to distance ourselves from the distance concept? Why home and host country context might matter more than (cultural) distance. Management International Review, 56(1), 1–34.

    Google Scholar 

  • Henisz, W., & Swaminathan, A. (2008). Institutions and international business. Journal of International Business Studies, 39(4), 537–539.

    Google Scholar 

  • Hernández, V., & Nieto, M. J. (2015). The effect of the magnitude and direction of institutional distance on the choice of international entry modes. Journal of World Business, 50(1), 122–132.

    Google Scholar 

  • Hitt, M. A., Li, D., & Xu, K. (2016). International strategy: From local to global and beyond. Journal of Word Business, 51(1), 58–73.

    Google Scholar 

  • Hoffman, A. J. (1999). Institutional evolution and change: Environmentalism and the U.S. chemical industry. Academy of Management Journal, 42(4), 351–371.

    Google Scholar 

  • Hofstede, G. (1980). Culture’s consequences: International differences in work-related values. Beverly Hills: Sage Publications.

    Google Scholar 

  • Hofstede, G. (2001). Culture’s consequences: Comparing values, behaviors, institutions, and organizations across nations (2nd ed.). Thousand Oaks: Sage Publications.

    Google Scholar 

  • Holburn, G. L., & Zelner, B. A. (2010). Political capabilities, policy risk, and international investment strategy: Evidence form the global electric power generation industry. Strategic Management Journal, 31(12), 1290–1315.

    Google Scholar 

  • Holmes, R. M., Jr., Miller, T., Hitt, M., & Salmador, M. P. (2013). The interrelationships among informal institutions, formal institutions, and inward foreign direct investment. Journal of Management, 39(2), 531–566.

    Google Scholar 

  • Hosteltur. (2016a). Ranking Hosteltur 2016 de presencia internacional. Retrieved April 4, 2017, from https://static.hosteltur.com/web/uploads/2015/10/Ranking_presencia_internacional_2015.pdf.

  • Hosteltur. (2016b). Ranking Hosteltur de grandes cadenas hoteleras. Retrieved April 4, 2017, from https://static.hosteltur.com/web/uploads/2016/10/Ranking_Hosteltur_2016_I_parte.pdf.

  • Hosteltur. (2016c). Ranking Hosteltur de cadenas de menos de 1000 habitaciones. Retrieved April 4, 2017, from https://static.hosteltur.com/web/uploads/2016/10/Ranking_Hosteltur_2016_II_parte.pdf.

  • Hutzschenreuter, T., & Voll, J. C. (2008). Performance effects of “added cultural distance” in the path of international expansion: The case of German multinational enterprises. Journal of International Business Studies, 39(1), 53–70.

    Google Scholar 

  • Jemison, D. B., & Sitkin, S. B. (1986). Corporate acquisition: A process perspective. Academy of Management Review, 11(1), 1145–1163.

    Google Scholar 

  • Jensen, N. M. (2003). Democratic governance and multinational corporations: Political regimes and inflows of foreign direct investment. International Organization, 57(3), 587–616.

    Google Scholar 

  • Johanson, J., & Vahlne, J. (1977). The internationalization process of the firm: A model of knowledge development and increasing foreign market commitment. Journal of International Business Studies, 8(1), 23–32.

    Google Scholar 

  • Kang, Y., & Jiang, F. (2012). FDI location choice of Chinese multinationals in east and southeast Asia: Traditional economic factors and institutional perspective. Journal of World Business, 47(1), 45–53.

    Google Scholar 

  • Kang, J. K., & Kim, J. M. (2010). Do foreign investors exhibit a corporate governance disadvantage? An information asymmetry perspective. Journal of International Business Studies, 41(8), 1415–1438.

    Google Scholar 

  • Kim, J. U., & Aguilera, R. V. (2016). Foreign location choice: Review and extensions. International Journal of Management Reviews, 18(2), 133–159.

    Google Scholar 

  • Kobrin, S. (1979). Political risk: A review and consideration. Journal of International Business Studies, 10(1), 67–80.

    Google Scholar 

  • Kogut, B., & Singh, H. (1988). The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3), 411–432.

    Google Scholar 

  • Kontinen, T., & Ojala, A. (2010). The internationalization of family businesses: A review of extant research. Journal of Family Business Strategy, 1(2), 97–107.

    Google Scholar 

  • Kostova, T. (1997). Country institutional profiles: Concept and measurement. Academy of Management Proceedings, 1, 180–184.

    Google Scholar 

  • Kostova, T. (1999). Transnational transfer of strategic organizational practices: A contextual perspective. Academy of Management Review, 24(2), 308–324.

    Google Scholar 

  • Kostova, T., & Roth, K. (2002). Adoption of organizational practices by subsidiaries of multinational corporations: Institutional and relational effects. Academy of Management Journal, 45(1), 215–233.

    Google Scholar 

  • Kostova, T., & Zaheer, S. (1999). Organizational legitimacy under conditions of complexity: The case of the multinational enterprise. Academy of Management Review, 24(1), 64–81.

    Google Scholar 

  • Krugman, P. R. (1991). Increasing returns and economic geography. The Journal of Political Economy, 99(3), 483–499.

    Google Scholar 

  • La Porta, R., López-de-Silanes, F., & Shleifer, A. (1999). Corporate ownership around the world. Journal of Finance, 54(2), 471–517.

    Google Scholar 

  • Leamer, E. E., & Storper, M. (2001). The economic geography of the internet age. Journal of International Business Studies, 32(4), 641–665.

    Google Scholar 

  • Lei, H. S., & Huang, C. H. (2014). Geographic clustering networking relationship and competitive advantage. Two industrial cluster in Taiwan. Management Decision, 52(5), 852–871.

    Google Scholar 

  • Li, J., Jiang, F., & Shen, J. (2016). Institutional distance and the quality of the headquarters-subsidiary relationship: The moderating role of the institutionalization of headquarters’ practices in subsidiaries. International Business Review, 25(2), 589–603.

    Google Scholar 

  • LiPuma, J. A., Newbert, S. L., & Doh, J. P. (2013). The effect of institutional quality on firm export performance in emerging economies: A contingency model of firm age and size. Small Business Economics, 40(4), 817–841.

    Google Scholar 

  • Maguire, S., Hardy, C., & Lawrence, T. (2004). Institutional entrepreneurship in emerging fields: HIV/AIDS treatment advocacy in Canada. Academy of Management Journal, 47(5), 657–679.

    Google Scholar 

  • Makino, S., Lau, C. M., & Yeh, R. S. (2002). Asset-exploitation versus asset-seeking: Implications for location choice for foreign direct investment from newly industrialized economics. Journal of International Business Studies, 33(3), 403–421.

    Google Scholar 

  • Malhotra, S. (2012). Geographic distance as a moderator of curvilinear relationship between cultural distance and shared ownership. Canadian Journal of Administrative Sciences, 29(3), 218–230.

    Google Scholar 

  • Marschan-Piekkari, R., Welch, D., & Welch, L. (1999). In the shadow: The impact of language on structure, power, and communication in the multinational. International Business Review, 8(4), 421–444.

    Google Scholar 

  • Martin, R., & Sunley, P. (2008). Slow convergence? The new endogenous growth theory and regional development. Economic Geography, 74(3), 201–227.

    Google Scholar 

  • Meyer, K. E., Estrin, S., Bhaumik, S., & Peng, M. W. (2009). Institutions, resources, and entry strategies in emerging economies. Strategic Management Journal, 30(1), 61–80.

    Google Scholar 

  • Molina Morales, F. X., Capó Vicedo, J., Tomás Miquel, J. V., & Expósito Langa, M. (2012). Análisis de las redes de negocio y de conocimiento en un distrito industrial. Una aplicación al distrito industrial textil valenciano. Cuadernos de Economía y Dirección de la Empresa, 15(2), 94–102.

    Google Scholar 

  • Morschett, D., Schramm-Klein, H., & Swoboda, B. (2010). Decades of research on market entry modes: What do we really know about external antecedents of entry mode choice? Journal of International Management, 16(1), 60–77.

    Google Scholar 

  • Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital and the organization advantage. Academy Management Review, 23(2), 242–266.

    Google Scholar 

  • National Statistics Institution—NSI (INE). (2016). Annual Report, 2016. Retrieved April 3, 2017, from http://www.ine.es.

  • Nebus, J., & Chai, K. H. (2014). Putting the “psychic” back in psychic distance: Awareness, perceptions, and understanding as dimensions of psychic distance. Journal of International Management, 20(1), 8–24.

    Google Scholar 

  • Newman, K. L. (2012). Cross-national distance: Concepts, measures and relationships. Journal of International Business and Economy, 13(2), 39–59.

    Google Scholar 

  • Nielsen, B. B., Asmussen, C. G., & Weatherall, C. D. (2017). Location choice of foreign direct investments: Empirical evidence and challenges. Journal of World Business, 52(1), 62–82.

    Google Scholar 

  • Nisbett, R. E. (2003). The geography of thought. New York: Free Press.

    Google Scholar 

  • North, D. C. (1990). Institutions institutional change and economic performance. Cambridge: Cambridge University Press.

    Google Scholar 

  • North, D. C. (1991). Institutions. Journal of Economic Perspectives, 5(1), 97–112.

    Google Scholar 

  • Ojala, A. (2015). Geographic, cultural, and psychic distance to foreign markets in the context of small and new ventures. International Business Review, 24(5), 825–835.

    Google Scholar 

  • Ojala, A., & Tyrväinen, P. (2007). Market entry and priority of small and medium-sized enterprises in the software industry: An empirical analysis of cultural distance, geographic distance and size. Journal of International Marketing, 15(3), 123–149.

    Google Scholar 

  • Ojala, A., & Tyrväinen, P. (2008). Market entry decisions of US small and medium-sized software firms. Management Decision, 46(2), 187–200.

    Google Scholar 

  • Pak, Y. S., & Park, Y. R. (2004). Global ownership strategy of Japanese multinational enterprises: A test of internalization theory. Management International Review, 44(1), 3–21.

    Google Scholar 

  • Peng, M. W. (2003). Institutional transitions and strategic choices. Academy of Management Review, 28(2), 275–296.

    Google Scholar 

  • Peng, M. W., & Khoury, T. A. (2009). Unbundling the institution based view of international business strategy. In A. Rugman (Ed.), The Oxford handbook of international business (2nd ed., pp. 256–268). New York: Oxford University Press.

    Google Scholar 

  • Perdomo, Y. (2016). Key issues for tourism development-the AM-UNWTO contribution. Worldwide Hospitality and Tourism Themes, 8(6), 625–632.

    Google Scholar 

  • Phillips, N., Karra, N., & Tracey, P. (2007). Rethinking institutional distance: Using neo-institutional theory to inform international management. Academy of Management Proceedings, August, Meeting Abstract Supplement. https://doi.org/10.5465/ambpp.2007.

    Google Scholar 

  • Plá-Barber, J., & Ghauri, P. N. (2012). Internationalization of service industry firms: Understanding distinctive characteristics. The Service Industry Journal, 32(7), 1007–1010.

    Google Scholar 

  • Puthusserry, P. N., Child, J., & Rodrigues, S. B. (2014). Psychic distance, its business impact and modes of coping: A study of British and Indian partner SMEs. Management International Review, 54(1), 1–29.

    Google Scholar 

  • Quer, D., Claver, E., & Rienda, L. (2012). Political risk, cultural distance, and outward foreign direct investment: Empirical evidence from large Chinese firms. Asia Pacific Journal Management, 29(4), 1089–1104.

    Google Scholar 

  • Ragozzino, R. (2009). The effects of geographic distance on the foreign acquisition activity of US firms. Management International Review, 49(4), 509–535.

    Google Scholar 

  • Ragozzino, R., & Reuer, J. J. (2011). Geographic distance and corporate acquisitions: Signals of IPO firms. Strategic Management Journal, 32(8), 876–894.

    Google Scholar 

  • Robock, S. H. (1971). Political risk: Identification and assessment. Columbia Journal of World Business, July–August, 6–20.

  • Ronen, S., & Shenkar, O. (1985). Clustering countries on attitudinal dimensions: A review and synthesis. Academy of Management Review, 10(3), 435–445.

    Google Scholar 

  • Rose, E. L., & Ito, K. (2008). Competitive interactions: The international competitive patterns of Japanese automobile manufacturers. Journal of International Business Studies, 39(5), 864–879.

    Google Scholar 

  • Rugman, A. M., & Verbeke, A. (2009). Location competitiveness and the multinational enterprise. In A. M. Rugman (Ed.), The Oxford handbook of international business (pp. 146–180). Oxford: Oxford University Press.

    Google Scholar 

  • Ruiz-Molina, M. E., Gil-Saura, I., & Moliner-Velázquez, B. (2011). Does technology make a difference? Evidence from Spanish hotels. Service Business, 5(1), 1–12.

    Google Scholar 

  • Sartor, M. A., & Beamish, P. W. (2014). Offshoring innovation to emerging markets: Organizational control and informal institutional distance. Journal of International Business Studies, 45(9), 1072–1095.

    Google Scholar 

  • Schomaker, M. S., & Zaheer, S. (2014). The role of language in knowledge transfer to geographically dispersed manufacturing operations. Journal of International Management, 20(1), 55–72.

    Google Scholar 

  • Schwens, C., Eiche, J., & Kabst, R. (2011). The moderating impact of informal institutional distance and formal institutional risk on SME entry mode choice. Journal of Management Studies, 48(2), 330–351.

    Google Scholar 

  • Scott, W. R. (1995). Institutions and organizations. Thousand Oaks: Sage Publications.

    Google Scholar 

  • Scott, W. R. (2014). Institutions and organizations: Ideas, interests, and identities. Thousand Oaks: Sage Publications.

    Google Scholar 

  • Shenkar, O. (2001). Cultural distance revisited: Towards a more rigorous conceptualization and measurement of cultural differences. Journal of International Business Studies, 32(3), 519–535.

    Google Scholar 

  • Slangen, A. H. L. (2011). A communication-based theory of the choice between greenfield and acquisition entry. Journal of Management Studies, 48(8), 1699–1726.

    Google Scholar 

  • Slangen, A. H. L., & Van Tulder, R. J. M. (2009). Cultural distance, political risk, or governance quality? Towards a more accurate conceptualization and measurement of external uncertainty in foreign entry mode research. International Business Review, 18(3), 276–291.

    Google Scholar 

  • Srivastava, R. K., & Green, R. T. (1986). Determinants of bilateral trade flows. Journal of Business, 59(4), 623–640.

    Google Scholar 

  • Tahir, R., & Larimo, J. (2005). Understanding the strategic motivations of Finnish manufacturing FDIs in emerging Asian economies. Asian Business and Management, 4(3), 293–313.

    Google Scholar 

  • Tihanyi, L., Griffith, D. A., & Russel, C. J. (2005). The effect of cultural distance on entry mode choice, international diversification, and MNE performance: A meta-analysis. Journal of International Business Studies, 36(3), 270–283.

    Google Scholar 

  • Tung, R. L., & Verbeke, A. (2010). Beyond Hofstede and GLOBE: Improving the quality of cross-cultural research. Journal of International Business Studies, 41(8), 1259–1274.

    Google Scholar 

  • Vernon, R. (1966). International investment and international trade in the product cycle. Quarterly Journal of Economics, 80(2), 190–207.

    Google Scholar 

  • Werner, S. (2002). Recent developments in international management research: A review of 20 top management journals. Journal of Management, 28(3), 277–305.

    Google Scholar 

  • West, J., & Graham, J. L. (2004). A linguistic-based measure of cultural distance and its relationship to managerial values. Management International Review, 44(3), 239–260.

    Google Scholar 

  • Williamson, O. E. (2000). The new institutional economics: Taking stock, looking ahead. Journal of Economic Literature, 38(3), 595–613.

    Google Scholar 

  • World Economic Forum (WEF) (2017). Global Competitive Index (2016–2017). http://www3.weforum.org/docs/GCR2016-2017/05FullReport/TheGlobalCompetitivenessReport2016-2017_FINAL.pdf.

  • World Tourism Organization of United Nations—UNWTO (2016). UNWTO tourism highlights report, 2016 edition. http://www.e-unwto.org/doi/pdf/10.18111/9789284418145.

  • Xu, D., Pan, Y., & Beamish, P. W. (2004). The effect of regulative and normative distances on MNE ownership and expatriate strategies. Management International Review, 44(3), 285–307.

    Google Scholar 

  • Xu, D., & Shenkar, O. (2002). Institutional distance and multinational enterprise. Academy of Management Review, 27(4), 608–618.

    Google Scholar 

  • Zaheer, S., & Mosakowski, E. (1997). The dynamics of the liability of foreignness: A global study of survival in financial services. Strategic Management Journal, 18(6), 439–464.

    Google Scholar 

  • Zaheer, S., Schomaker, M. S., & Nachum, L. (2012). Distance without direction: Restoring credibility to a much-loved construct. Journal of International Business Studies, 43(1), 18–27.

    Google Scholar 

  • Zhou, N., & Guillén, M. F. (2015). From home country to home base: A dynamic approach to the liability of foreignness. Strategic Management Journal, 36(6), 907–917.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Complutense University of Madrid, Campus de Somosaguas, Pozuelo de Alarcón, Madrid, Spain

    Ana M. Romero-Martínez

  2. Rey Juan Carlos University, Madrid, Spain

    Fernando E. García-Muiña

  3. University of Birmingham, Birmingham, UK

    Agnieszka Chidlow

  4. University of Vaasa, Vaasa, Finland

    Jorma Larimo

Authors
  1. Ana M. Romero-Martínez
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Fernando E. García-Muiña
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Agnieszka Chidlow
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Jorma Larimo
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Ana M. Romero-Martínez.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Romero-Martínez, A.M., García-Muiña, F.E., Chidlow, A. et al. Formal and Informal Institutional Differences Between Home and Host Country and Location Choice: Evidence from the Spanish Hotel Industry. Manag Int Rev 59, 41–65 (2019). https://doi.org/10.1007/s11575-018-0369-8

Download citation

  • Received:

  • Revised:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11575-018-0369-8

Keywords

Search

Navigation