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Regional culture and corporate finance: a literature review

Author

Listed:
  • Lina Mao

    (Communication University of Zhejiang)

  • Chongluan Lu

    (Renmin University of China)

  • Guangfan Sun

    (Renmin University of China)

  • Chunyan Zhang

    (Beijing Normal University)

  • Changwei Guo

    (Renmin University of China)

Abstract

According to the theory of institutional economics, local culture has a profound impact on individuals and groups. It fundamentally affects individual preferences and attitudes, guiding decision-making behaviors to develop homogeneous regional cultural characteristics. This, in turn, reflects in the business decisions of companies, leading to imbalances in the development of different regional enterprises. This article reviews the relevant literature on regional culture and corporate finance, aiming to investigate how regional culture plays a significant role in corporate governance and corporate performance. It explores the limitations of existing research and further analyzes issues related to the quantification of culture, its mechanism of influence, and endogeneity in regression models.

Suggested Citation

  • Lina Mao & Chongluan Lu & Guangfan Sun & Chunyan Zhang & Changwei Guo, 2024. "Regional culture and corporate finance: a literature review," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    • Handle: RePEc:pal:palcom:v:11:y:2024:i:1:d:10.1057_s41599-023-02551-8
    DOI: 10.1057/s41599-023-02551-8
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