Cultural impact on investment destination choice of US‐multinational corporations in Australia

Abstract

Theories frequently used by researchers’ only offer limited insight, they do not explain why some multinationals continue to invest in some countries despite being rated low on the reasons explained by economic and comparative advantage theories. The paper examines the attractiveness of Australia as an investment destination for US based multinational corporations. By using Porter’s national advantage theory and other variables of country attractiveness, it examines what makes Australia an attractive destination. Within the fast moving consumer goods industry, Australia was found to be attractive for three reasons: incentives offered by the government, low risk and cultural distance. There is evidence that culture has an effect on the choice of foreign investment venture structure well ahead of market size, tariffs, growth and location to cultural similarity. The aim was not only to generate ideas for future more rigorous research but also to investigate the impact critical to elements, such as culture, that make foreign investments attractive.

Citation

D’Souza, C. and Peretiatko, R. (2005), "Cultural impact on investment destination choice of US‐multinational corporations in Australia", Cross Cultural Management: An International Journal, Vol. 12 No. 3, pp. 14-31. https://doi.org/10.1108/13527600510798051