AMERICAN JOURNAL OF MANAGEMENT
Bounded Rationality: Effect on International M&A Performance of MNEs
Author(s): Xiaoruo Xu, Chuandi Jiang
Citation: Xiaoruo Xu, Chuandi Jiang, (2017) "Bounded Rationality: Effect on International M&A Performance of MNEs," American Journal of Management, Vol. 17, Iss. 3, pp. 89-95
Article Type: Research paper
Publisher: North American Business Press
Abstract:
From a transaction cost economics perspective, this study builds a model to explain how the bounded rationality suggested by transaction cost economics affects the cross-cultural management capability, which in turn influences multinational enterprises (MNEs) performance of international Mergers and Acquisitions (M&A). We explain the moderating effects of cultural distance, cultural intelligence and global mindset in the relationship between bounded rationality and MNEs performance, and argue that cultural distance has a negative impacts on MNEs post M&A performance and cultural intelligence and global mindset are positively associated with the cognitive capability of managers to deal with crosscultural issues.