Reliance on AI in Augmented Strategic Decision-Making: Navigating Cultural and National Dynamics

While AI tools are available worldwide, the institutional context in which decision-makers operate likely influences their reliance on this technology. Our study examines how national institutional environments shape managers’ reliance on AI tools in augmented strategic decisions. We investigate the role of collective norms shaped by two institutions—national culture and the national government—on AI augmented strategic decision-making. We conducted a vignette study with 172 managers across seven countries. Following the theory of cultural tightness and looseness, we show that cultural tightness increases decision-makers' reliance on AI. Additionally, in tighter cultures, where individuals internalize hierarchically defined norms and rules, government AI endorsement further strengthens reliance on AI advice. We contribute to the literature on AI-human interaction and on cross-cultural decision-making by showing how different cultural environments can either enhance or hinder managerial reliance on AI, while also bringing important implications for MNEs and governments seeking to leverage AI for competitive advantage.