DOUBLE-EDGED SWORD EFFECT OF CULTURAL DIFFERENCE ON INTERNATIONAL ALLIANCE

This paper reconciles the contradictory findings about the effect of differences in national cultures on international alliance performance. By using system dynamics with previous empirical findings, we built a dynamical model to simulate the behaviour of an international alliance. Simulations revealed that under the same differences in national cultures, high levels of communication quality, trust, flexibility, commitment, and technique efficiency for problem solving are required to make an alliance succeed while low level of any one of them will make an alliance fail. As these indicators are independent of differences in national cultures, it implies that international alliance in psychically closer countries cannot guarantee a higher probability of success.