TY  - JOUR
T1  - Language friction and partner selection in cross-border R&D alliance formation
JF  - Journal of International Business Studies
Y1  - 2014
A1  - Joshi,Amol
A1  - Lahiri,Nandini
KW  - Strategy & Entrepreneurship
AB  - How does language friction affect alliance formation? Language friction is a form of cultural friction arising from structural differences in the respective languages used by potential partners to reason and solve problems together. A little language friction may prompt partners to rethink solutions, thereby enhancing collaboration, but excessive friction may impede collaboration. We develop a Language Friction Index (LFI) to quantify relative differences in linguistic structure for any language pair. Utilizing a unique data set of semiconductor design activities (1988–2001), our empirical analysis finds an inverted U-shaped relationship between partners’ LFI and the likelihood of cross-border research and development (R&D) alliance formation. This relationship is further moderated by prior ties and technological distance. Our findings have several important implications, including: (1) language differences are a measurable and discernible source of cultural friction; (2) the effects of language friction are economically significant and strategically consequential; (3) certain aspects of language friction occur independent of language proficiency and persist despite the use of lingua franca to reduce language barriers; (4) linguistic diversity is an indirect marker of cognitive diversity, which is useful in boosting creativity, especially in first-time collaborations; (5) beyond R&D alliances, language friction may also influence other types of strategic interactions and organizational processes.
VL  - 46
U2  - a
U4  - 100635899904
ID  - 100635899904
ER  -