The bright and dark sides of CEO hubris: Assessing cultural distance in international business

Abstract

This paper aims to enrich the behavioral theory of international business strategyby investigating how CEO hubris (i.e., excess pride and confidence) affects inter-national strategic choices, that is, location selection, entry timing, and modes ofentry into the target market. Specifically, we focus on the relationship betweencultural distance and international strategic choices and consider hubris as a mech-anism that influences CEOs’ decisions. Our conceptual framework recognizes thatthe performance of international strategies managed by hubristic CEOs isextremely volatile. On the one hand, we corroborate the idea that hubris has adark side that may lead to pernicious outcomes. On the other hand, we recognizea bright side of hubris related to the consideration that overconfidence may some-times be seen as a necessary CEO quality that in turn differentiates one firm fromthe others.