Culture and Corruption: A Vicious Cycle Lessons From Project GLOBE

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Culture and Corruption A Vicious CycleLessons
From Project GLOBE

• Presented by Mansour Javidan

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The impact of culture

• Max Weber (1864-1920) theorized that the work
  ethic associated with Protestantism was largely
  responsible for the differences in wealth between
  Northern and Southern European countries
  (1904/1930 1904/1998).

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The impact of culture

• Banfield (1958) provided a cultural explanation
  of poverty and authoritarianism in Southern
  Italy.

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The impact of culture

• Myrdal (1968), in a ten year study of South Asia
  concluded that cultural factors are the principal
  obstacles to modernization.

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The impact of culture

• Kahn (1979) and Hofstede and Bond (1988) argued
  that the impressive economic growth experienced
  in South East Asian countries during the
  1965-1985 period was mainly due to the regions
  Confucian cultural roots.

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The impact of culture

• Harrison (1992) asks the question Why do some
  nations and ethnic groups do better than others?
• His answer The overriding significance of
  culture is the paramount lesson I have learned in
  my thirty years of work on political, economic,
  and social development

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The impact of culture

• Landes (2000), in a review of the evidence,
  concluded that Max Weber was right. If we learn
  anything from the history of economic
  development, it is that culture makes almost all
  the difference

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The impact of culture

• Even Michael Porter agrees
• Attitudes, values, and beliefs that are
  sometimes collectively referred to as culture
  play an unquestioned role in human behavior and
  progress. This is evident to me from working in
  nations, states, regions, inner cities, and
  companies at widely varying stages of
  development. (Porter, 2000)

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THE GLOBE RESEARCH PROGRAM

• 160 social scientists and management scholars
  from 62 cultures representing all major regions
  throughout the world are engaged in this
  long-term programmatic series of cross-cultural
  leadership studies.

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Participating GLOBE countries
Countries
Cluster
Argentina Bolivia Brazil Colombia Costa
Rica Ecuador El Salvador Guatemala Mexico Venezuel
a
Latin America
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Participating GLOBE countries
Countries
Cluster
Latin Europe
France Switzerland (French-speaking) Israel Italy
Portugal Spain
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Participating GLOBE countries
Countries
Cluster
China Hong Kong Japan Korea, Republic Singapore
Taiwan
Confucian Asia
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Participating GLOBE countries
Countries
Cluster
Australia Canada (English-speaking) Ireland New
Zealand South Africa (White Sample) United
Kingdom United States
Anglo
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Participating GLOBE countries
Countries
Cluster
Southern Asia
India Indonesia Iran Malaysia The
Philippines Thailand
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Participating GLOBE countries
Countries
Cluster
Austria Germany-East (former GDR) Germany-West
(former FRG) The Netherlands Switzerland
Germanic Europe
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Participating GLOBE countries
Countries
Cluster
Denmark Finland Sweden
Nordic Europe
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Participating GLOBE countries
Countries
Cluster
Egypt, Arab Rep. Kuwait Morocco Qatar Turkey
Middle East
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Participating GLOBE Countries
Countries
Cluster

• Eastern Europe

• Albania
• Georgia
• Greece
• Hungary
• Kazakhstan
• Poland
• Russian Federation
• Slovenia

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Participating GLOBE countries
Countries
Cluster
Namibia Nigeria South Africa (Black
sample) Zambia Zimbabwe
Sub-Saharan Africa
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The Theoretical Definition of Culture

• Shared motives, values, beliefs, identities, and
  interpretations or meanings of significant events
  that result from common experiences of members of
  collectives and are transmitted across
  generations.

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• GLOBE measures both cultural practices (as is)
  and cultural values (should be).

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• Over 17000 middle managers from over 900
  corporations in food processing, finance, and
  telecommunications industries in 62 cultures
  participated in GLOBE surveys.

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Culture Construct Definitions

• Specific Questionnaire Item
• Followers are (should be) expected to obey their
  leaders without question.

• Power distance
• The degree to which members of a collective
  expect power to be distributed equally.

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Culture Construct Definitions

• Family Collectivism
• The degree to which individuals have strong ties
  to their small immediate groups

• Specific Questionnaire Item
• In this society, children live with parents
  until they get married.

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Culture and Trust

•  

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Trust in Public Institutions

• Contracts and Law sub index
• Judicial independence
• Property rights
• Favoritism in decisions of government officials
• Organized crime
• Corruption sub index
• Irregular payments in exports and imports
• Irregular payments in public utilities
• Irregular payments in tax collection

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Culture and Economic Performance
  Power Distance Family Collectivism
Average GDP/Capita, 1998-2004 -0.49 -.75
Average Economic Performance Rankings 98-05(IMD) 0.36 0.42
Average Competitiveness Rankings 98-05 (IMD) 0.65 0.65
Economic Productivity (average GDP/P,98-04, WB) -0.46 -0.69
Average Annual Growth in GDP/capita, 98-04 (WB) -0.45 -0.65
GINI (UN Human Development Report, 2004) 0.36 0.34
Share of Income or Consumption by the Top 20 (World Development Report) 0.36 0.32
Share of Income or Consumption by the Bottom 20 (World Development Report ) -0.29 -0.28
Extent to which government policies are conducive to competitiveness (IMD index, 2005) -0.56 -0.49
of GDP spent on education (UN Human Development Report, 2004) -0.35 -0.48
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Culture and Individual Health
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WHY?

• The micro approach Culture as a lens (Javidan et
  al, 2006 Hofstede, 2001 Lindsey, 2000)
• Rather well developed by age 16
• Shapes of way of interpreting the world
• Shapes how we make decisions
• Shapes how we behave and relate to others

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WHY?

• The macro approach Institutions (Redding, 2005,
  North, 1990)
• Culture underlines and drives the countrys
  institutional framework
• The institutional framework underlines its
  political, administrative, and business systems

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Is it Hopeless?

• Not necessarily!
• Cultural values are in the right direction for
  Power Distance
• Many countries have young populations
• Individuals are not cultural robots
• Leaders can make a difference

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Thank you!

• Visit GLOBE at
• http//www.thunderbird.edu/wwwfiles/ms/globe/