Individualism, Culture and Entrepreneurial Opportunities*
brb altering history
The present paper evaluates the effect of living in an individualistic society on
entrepreneurial opportunities, using cross-country data from the GEDI. Individualism
is one of the five cultural dimensions proposed by Hofstede (2001) and it is considered
by intercultural psychologists the main dimension of cultural variation. For individualism is a cultural trait that emphasizes freedom and rewards one’s own personal
achievements, it increases the propensity to open new businesses and realize own ideas,
despite the possibility of failure. So as to prevent reverse causality between individualism and entrepreneurial activity, we use the frequency of blood types and other
genetic data as instruments. The data show a positive and highly significant effect
of individualism on entrepreneurship, even after controlling for education, religion,
fertility, unemployment, the ease of doing business, networking, among others.
Economists try to pretend the race-culture connection isn’t important but….
Look at ‘lil Venezuela down there, I wonder what will happen to them?
This is why Trump doing the trade war is a genius move. THIS.
In countries with more individualistic cultural characteristics, they have a predominance of individuals seeking potentially better opportunities to conduct an initial business, as well as characteristics with a greater perception of entrepreneurial opportunity. Similarly, Figure 5 suggests that countries with
more individualistic cultures often have greater opportunities to start a business. As for example, Canada, United States, Great Britain and Australia. The ten countries with the highest GEI index in 2017 were: the USA, Switzerland, Canada, Sweden, Denmark, Iceland, Australia, the United Kingdom, Ireland and the Netherlands.
I wonder what THEY have in common.
1950s GDP: not race (only) but cultural individualism.
Therefore, it measures the quality of entrepreneurship, as we are concerned with the quality of entrepreneurship: the entrepreneur driven by opportunities that generate commercial success. The definition of entrepreneurship that we will adopt is related to job creation and growth through innovation.
aka GDP, real ingroup gains
No, Asians can’t take over capitalism. That can literally never happen.
They’re collectivists, they get crony capitalism, they’ll fuck it up.
We just have to survive that.
I wonder what this figure indicates…
You’ve got me.
Yes, this is definitely my opinion.
My educated opinion.
As you can see, I am very jelly.
Thus, the most appropriate model for the analysis of the effect of entrepreneurial activity on individualism is that of column (5).
Considering the above-identified situation of a possible endogeneity between the variables, instrumental fractional variables were included for the econometric analysis. This process requires variables that are related to individualism, but not to entrepreneurial activity.
This hypothesis is sufficient so that the causal relation can be established in the proper direction. Thus, for individualism we use the blood distance of Mahalanobis and the pathogenic genes according to Gorodnichenko and Roland (2017). In table 2, the individualism and each possibility of instrument: distM-UK and mean of pathogens, which are, respectively, Mahalanobis blood distance between the country in England and the mean of the presence of the nine genes pathogens considered relevant to Murray’s individualist collectivist analysis: leishmaniasis, trypanosomes, malaria, schistosomiasis, filaria, leprosy,dengue, typhus and tuberculosis.
My opinion, clearly.
I magically altered their blood, to lie.
I can do that.
The relationship is negative, because it suggests that the closer to the entrepreneurial country, the more individualistic the culture will be.
Table 3 includes some more control variables, particularly related to institutions and their long-run effect on development. Precisely due to their persistence, it is important to separate the effect of culture from institutions as good as possible, although this it is a difficult matter and still an ample field of research (Gorodnichenko and Roland 2017; Spolaore and Wacziarg 2013)
Muh opinion, clearly.
I’m just jealous of cultures that enslave their children to make my phone.
Table 4 repeats our preferred estimation, the fractional probit instrumental variable model,
for a number of subsamples. On the one hand, the sample is divided into countries that
experienced European colonization and those that did not. The former may have suffered
a mixture of cultures that is not captured by the genetic data. Therefore, if any, we expect
the effect of individualism to be stronger and more precise in the latter subsample.
To sum up, we find remarkably few differences in the magnitude of the individualism index
across the estimations in tables 3 and 4. In fact, the point estimate is not statistically
different from the baseline regressions in table 2 and in all of the seven estimation do
we obtain a positive and significant effect of individualism on the opportunity to start a
The argument for muh civic nationalism, muh brain drain immigration is a pack of lies.
They are not the same as us.
The present paper evaluated the hypothesis that individualism can influence the entrepreneurial activity, accounting for cross-country differences in education, religion, fertility, unemployment, ease of opening a company and networking. The data shows a strong and remarkably robust relationship between living in an individualistic culture and entrepreneurship.
Things libertarians pretend to give a shit about.
The West is WEIRD – nobody else.
Although one should be careful in interpreting our results as causal, our estimates of fractional probit instrumental variable approach suggests a plausible interpretation of this relationship. We explored other potentially important channels in determining entrepreneurial activity.
The effect may potentially be confounded by geography, climate conditions, or through European colonization, as well as through persistent institutions, such as the risk of expropriation. In addition, the influence of the culture dimension of individualism was tested separately for each group of countries belonging to the OECD or not. It was concluded that the effects remained positive and significant, confirming the validity of the results and of the instruments.
Finally, the perceptions of the opportunity to start a business are different from society
to society, so the origin of these differences and their influences is important. Thus, this
article thus complements the studies on entrepreneurship (Pinillos and Reyes (2011), Liñán
and Fernandez-Serrano (2014), Dheer (2017), Doepke and Zilibotti (2014), Laskovaia et al.
(2017) and Nikolaev et al. (2018).
Ya snooze, ya lose.