Abstract
AbstractThis paper aims to enrich the behavioral theory of international business strategy by investigating how CEO hubris (i.e., excess pride and confidence) affects international strategic choices, that is, location selection, entry timing, and modes of entry into the target market. Specifically, we focus on the relationship between cultural distance and international strategic choices and consider hubris as a mechanism that influences CEOs' decisions. Our conceptual framework recognizes that the performance of international strategies managed by hubristic CEOs is extremely volatile. On the one hand, we corroborate the idea that hubris has a dark side that may lead to pernicious outcomes. On the other hand, we recognize a bright side of hubris related to the consideration that overconfidence may sometimes be seen as a necessary CEO quality that in turn differentiates one firm from the others.
Highlights
The international business (IB) literature identifies various antecedents affecting the decision of a firm to enter a foreign country (Hitt et al, 2006)
We investigate the role of CEO hubris in the decision to enter a foreign market and the set of choices regarding the selection of the target location, the right entry timing, and the most suitable entry mode
Drawing on the behavioral theory of strategy, this study explores the impact of CEO hubris on the choice to enter a foreign market and the main decisions associated with international entry
Summary
The international business (IB) literature identifies various antecedents affecting the decision of a firm to enter a foreign country (Hitt et al, 2006). An analysis of real business cases shows that CEOs might exhibit deep trust and overestimate their own abilities (Dagnino et al, 2013; Eckhaus & Sheaffer, 2018). As a consequence, this cognitive bias may drive them toward decisions to internationalize that may not be supported by a thorough rational analysis
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
