Institutional Learning,Cultural Distance And Determinants Of Corss-border Syndication

In recent years,with the internationalize tendency of venture capital,cross-border venture capital investment in emerging markets has been the focus of scholars attention.Be confronted with the uncertainty about cultural distance and institutional difference,cross-border venture capital choose syndication as an effective investment strategy.This paper attempts to study from the perspective of cross-border venture capitalists to analyze how cross-border venture capitalists use syndication strategy to reduce liabilities of foreignness when they invest in China’s venture capital market confronted with the cultural distance and institutional difference uncertainty,and the determinants of cross-border syndication.This paper includes cultural distance and institutional learning in the scope of study about determinants of cross-border syndication for the first time,and tries to prove them under the unique culture and institution environment of China.This paper chooses 4557 pieces data of all rounds of cross-border investments from the beginning of 1993 to the end of 2013 as research materials,and proposes 11 hypotheses regarding the characteristics of cross-border venture capitalists,financing events and ventures,and uses econometrics method to build logistic regression models to prove the hypotheses.The conclusions are as follows: cultural distance will cause a series of costs of communication problems,trust issues and liability of foreignness,and increase the probability of cross-border syndication;institutional learning can decrease the uncertainty brought by cultural distance and institutional distance,and decrease the probability of cross-border syndication;besides,the syndication decision by cross-border venture capitalists will also be affected by financing size,investment year and venture location.