Power Distance:[7]
High power distance suggests that a more formal hierarchy of authority and control, greater centralization of knowledge and responsibility, exessive rule and more restricted exchnge of knowledge. These charactersticts of high power distance are expected to stifle innovation, while lower power distance, characterized by less hierarchy, fewer rules, greater decentralization of knowledge and free flow of information is associated with more innovative efforts.

Uncertainity Avoidance:[7]
High uncertainity avaidance indicates an inabilty to deal with ambigiuous situations, requiring a need for formal rules and procedures to avoid ambiguity, while low uncertainity avoidance reflects an acceptance and ability to operate in ambiguios situations.low uncertainity avoiding characterstics are more typically associated with innovative efforts, while the characterstics of higher uncertainty avoiding cultures would be exhibited to inhibit innovation and be more closely associated with an adaptive focus on R&D activities.

Cultural Distance from investing country:[7]
There is an negative relationship among the cultural distance and foreign R&D investment.[8]. At initial stages od internationalization firms prefer similar cultures ,but that preference dissipates as firms move to more advanced stages of expansion.[9]

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