Culture Rules: The Foundations of the Rule of Law and Other Norms of Governance
Amir N. Licht
Interdisciplinary Center (IDC) Herzliyah - Radzyner School of Law; European Corporate Governance Institute (ECGI)
Interdisciplinary Center (IDC) Herzliyah - Radzyner School of Law
Shalom H. Schwartz
Hebrew University of Jerusalem - Department of Psychology; National Research University Higher School of Economics
Journal of Comparative Economics, Vol. 37, pp. 659-688, 2007
This study presents evidence about relations between national culture and social institutions. We operationalize culture with data on cultural dimensions for some 50 nations adopted from cross-cultural psychology and generate testable hypotheses about three basic social norms of governance: the rule of law, corruption, and democratic accountability. These norms correlate systematically and strongly with national scores on cultural dimensions and also differ across cultural regions of the world. Using a linguistic variable on pronoun drop as an instrument for cultural emphases on autonomy versus embeddedness points to a significant influence of culture on governance. Using cultural profiles of a previous generation as an instrument indicates relative stability of cultural orientations and of their correlates. The results suggest a framework for understanding the relations between fundamental institutions.
Number of Pages in PDF File: 50
Keywords: culture, social institutions, governance, rule of law, corruption, democracy
JEL Classification: K00, O10, O19, P20, P26, P50, Z13Accepted Paper Series
Date posted: September 25, 2007
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