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Abstract Since 1990s, more and more enterprises from developed and developing countries are going international

with the economic globalization, which is deeply influencing the whole world economic. Especially, Chinese foreign direct investment is speeding up from the year of 2000 at which the strategy of "going out" is implemented. However, during this process of multinational enterprises (MNEs) expedite expanding, more and more failure cases of MNEs frequently occurred such as the merge and acquisition(M&A) of Daimler and Chrysler, Telefynica and Sonera,TCL and Thomson, BenQ and Siemens and so on, which are not only from developed countries but also from developing countries such as China. So studying the performance of MNEs is a very important and meaningful task in practice for the developed countries or China.In fact, researchers are beginning to explore the impacts of entry mode or national culture on the performance of MNEs. However, these researches have conflicting or inconsistent conclusions.Some of them point out national cultural distance has positive effects on the performance, others put forward its negative effects. Besides, most of these studies are based on the MNEs from developed countries. Whether these research findings applying to explain the behaviors of MNEs from developing countries or not needs to be tested. So studying the relationship of national cultural distance, entry mode and performance of MNEs from developing countries especially China, which is of significance in theoretical research and in guidance of the internationalization of Chinese MNEs.I.The subject and reasoning content of the paperThis paper aims to study the relationship of national cultural distance, entry mode and performance of MNEs, explore and test the transmitting path among them which is used to explain the conflicting conclusions and guide the Chinese MNEsforeign direct investment (FDI), which is the subject of this paper. Specifically, this subject reasoning is divided into three parts. The first part, the subject to be studied is put forward.In the first part, this paper describes and evaluates the performance status of Chinese MNEs through comparing the large-scale MNEs of developed countries from macro and micro-aspects, and then points out its national culture and entry mode influence by analyzing some cases.The second part, relative theories and literatures is reviewed, and the transmitting route is advanced.In the second part, this paper fristly reviewed the definitions of culture and entry mode, the theories of

national culture difference and entry mode,such as the national cultural difference theory from Hofested, Triandis,Trompenaars and so on,the entry mode theory of Transaction Cost, OLI, Uppsala Modle and so on. And then these theories are evaluated and one of the theories is chosen to guide the theoretical analysis and the econometric model building thereinafter by comparing them.Secondly, this paper confines the research scope to national cultural distance(short for CD), FDI entry modes especially Wholly Owned Subsidiary or Joint Venture(WOS or JV)and the performance of foreign subsidiary companies of the FDI enterprise, then analyzes relative literatures especially the inconsistent conclusions between CD and performance, finally puts forward and proves the transmitting route of CD affecting the performance to explain the inconsistent conclusion, Which is following as this:CD affecting entry mode choosing; entry mode choosing affecting performance;CD indirectly affecting performance by entry mode choosing; CD affecting performance directly.The third part, whether the transmitting route of CD affecting the performance applies to Chinese MNEsFDI or not is tested empirically by econometric model, and some of the results is used to guide Chinese MNEs FDI.In the third part, this paper divides the route of CD affecting the performance testing into two aspects. The first aspect, whether CD affecting the entry mode or not is tested by Chinese MNEsFDI samples through model specification, based on the Transaction Cost and Hofstedes National Cultural Difference theories, and binomial logistic regression.The second aspect, whether FDI entry mode affecting the performance and CD directly or indirectly affecting the performance is tested by the same sample used in the first aspect through model specification, based on relative literatures, and multilinear regression.Finally, this paper judges the validity of Chinese companiesFDI entry mode and educes the optimization of FDI entry modes decision-making process, basing on the testing results from the two aspects.II. The main conclusions of the paperIn one word, through the theoretical analysis and empirically test of the three parts, this paper draws to some arguments as followed:Firstly, this paper argues that the performance status of Chinese MNEs is not as good as those from developed countries, and the national cultural difference has some impacts on the performance of Chinese MNEs. Secondly, this paper argues that the transmitting route of CD affecting performance by entry mode choosing exists, and it is proved by Chinese MNEs samples.

That is to say this route can apply to Chinese MNEsFDI. Thirdly, because of different indicators of performance,moderating effects from entry mode leads to the conflicting results between CD and performance, the route of CD affecting performance can explain the inconsistent conclusions of past literatures from direct and indirect influences.Finally,the argument that validity of optimization of FDI entry modes decision-making process from Jianli, Liu is supported. The main contributions of the paperIn brief, this paper contributes to explore the relationship of CD, entry mode and performance, put forward the route of CD affecting performance to explain the inconsistent conclusions and tests the route among them by Chinese MNEs samples, finally makes full use of them to analyze and guide Chinese MNEs internationalization. Besides, this paper has some contributions to empirical methods, including new samples from Chinese MNEs, econometric model building of Chinese MNEsentry mode based on one kind of entry mode theory not many theories, computing the total CD by five not four cultural dimensions and testing the impacts from individual cultural dimensions on the entry mode choosing. The following research direction of the paperAlthough this paper gets some conclusions, there are some deficiencies. Culture is a complex concept including about 200 kinds of definitions. This paper just studied one part of it. Besides, the transaction cost theory and Hofstedes national cultural theory chosen by this paper have their inherent deficiencies. For these reasons and with Chinese enterprisesinternationalization continually advancing, the relative problems around national culture, entry mode and performance of MNEs need following intensive studies:First, the following researches could try to use different culture definitions or different cultural measurement methods to study its impacts on the entry mode and performance of MNEs.Second, because of Chinese MNEsFDI still on the exploring stage, the national culture theories and entry mode theories based on the MNEs from the developed countries may not apply to Chinese MNEs. The future researches could focus on the eastern culture theory and entry mode theory based on the MNEs from developing countries especially China.Third, with more and more Chinese financial enterprises going international, Chinese researchers need to pay much more attention to their entry strategy, cultural impacts and special internationalization laws and so on.Finally, as for the crosscultural risks, political or market risks and many other risks from host countries

confronting MNEs, nowadays more and more MNEs choose mixed or compound entry modes to elude these risks. For this trend, Chinese researchers can not ignore the study of mixed entry modes in order to provide Chinese MNEs with effective and efficient suggestions.