The impact of institutional difference on Vietnamese firms’ export intensity: The role of international experience

Abstract

Institutional theory and most previous studies assume that institutional difference between home and host countries is negatively related to firm’s performance in foreign market (including firm’s export intensity). Extending this assumption, we hypothesize that international experience is likely to moderate the negative effect of institutional distance on firm’s export intensity. Survey data from World Bank on 305 Vietnamese firms were used to test the proposed hypotheses. Both Tobit and OLS regressions reveal that with controlling characteristics of firm, the negative effect of institutional difference on export intensity of firm with the low level of international experience is higher than on that with the high level of international experience. The study provides managerial implications to literature.