Institutional drivers of attention to forward- versus backward-looking determinants in strategic decision-making

This research investigates the contingent influences on firms’ focus of attention to backward- versus forward-looking determinants of search behaviors. Although the impact of both forward- and backward-looking determinants on the risk-taking behavior of firms has been empirically manifested, no research to date has explored what external contingent factors make firms’ search behaviors more influenced by backward- versus forward-looking determinants. On this ground, this study aims to explore the conditions which make firms more forward- or backward looking in regulating their search behaviors. Our results show that capital market development, bank-based financial systems, as formal institutional dimensions, and future orientation, as a national culture dimension, significantly moderate the impact of backward- and forward-looking determinants on firms’ search behaviors.