LAUSR

Abstract One IB research stream on country distance supports that distance is influenced by the observers' perceptions, which reflect their unique experiences, as working abroad and cultural background. This study on distance perception is different but complements previous research, as we focus on certain systemic biases in perception that are inherent in fundamental human thinking processes when judging similarity. We build on cognitive psychology research, which shows these biases stem from mental shortcuts and heuristics, which people are prone to take in certain circumstances. We test our theory by conducting three experiments. First, we examine a different source of country distance asymmetry due to the fact that one of the countries in a pair is more salient. Second, we propose that context affects country similarity in that distance depends not only on the characteristics of the two countries being compared, but also other countries under consideration. Third, we challenge the notion that perceptions of country similarity and dissimilarity are exact opposites. We argue that ‘distance’ between two countries is a function of the number and salience of characteristics that two countries have in common, or similarity, and those features that are in one country but not in the other, or dissimilarity.