Culture Rules: The Foundations of the Rule of Law and Other Norms of Governance

50 Pages Posted: 25 Sep 2007

See all articles by Amir N. Licht

Amir N. Licht

Reichman University; European Corporate Governance Institute (ECGI)

Chanan Goldschmidt

Reichman University - Interdisciplinary Center (IDC) Herzliyah - Harry Radziner School of Law

Shalom H. Schwartz

Hebrew University of Jerusalem - Department of Psychology; National Research University Higher School of Economics (Moscow)

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Abstract

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.

Keywords: culture, social institutions, governance, rule of law, corruption, democracy

JEL Classification: K00, O10, O19, P20, P26, P50, Z13

Suggested Citation

Licht, Amir N. and Goldschmidt, Chanan and Schwartz, Shalom H., Culture Rules: The Foundations of the Rule of Law and Other Norms of Governance. Journal of Comparative Economics, Vol. 37, pp. 659-688, 2007, Available at SSRN: https://ssrn.com/abstract=1016693

Amir N. Licht (Contact Author)

Reichman University ( email )

Israel

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium
952-9-9513323 (Fax)

HOME PAGE: http:/www.ecgi.org

Chanan Goldschmidt

Reichman University - Interdisciplinary Center (IDC) Herzliyah - Harry Radziner School of Law ( email )

P.O. Box 167
Herzliya, 46150
Israel

Shalom H. Schwartz

Hebrew University of Jerusalem - Department of Psychology ( email )

National Research University Higher School of Economics (Moscow) ( email )

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

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