Nearby or Faraway? Family Firms’ FDI Location Choices under Internal and External Threats

Stemming from the bifurcation bias approach, this article investigates whether there is a relationship between family ownership concentration and cultural distance in foreign direct investments’ (FDIs’) portfolio and to what extent contingency factors, such as internal (below target performance) or external (global financial crisis) threats, can impact this relationship. Our findings suggest that family firms with concentrated ownership are more affected by bifurcation bias, pursuing FDIs in less culturally distant locations, while also showing a greater ability to fix such bias, and undertake FDIs in more culturally distant locations when the occurrence of internal and external threats forces family owners to revise their priorities