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Until recently, economists have been reluctant to rely on culture as a possible determinant of economic phenomena: Applied Economic Issues in Global Economy Assignment, UOE, UK
| University | university of Essex (UOE) |
| Subject | Applied Economic Issues in Global Economy |
Until recently, economists have been reluctant to rely on culture as a possible determinant of economic phenomena. Much of this reluctance stems from the very notion of culture: it is so broad and the channels through which it can enter the economic discourse so ubiquitous that it is difficult to design testable hypotheses. Without testable hypotheses, however, there is no role for culture in economics except perhaps as a selection mechanism among multiple equilibria.
In recent years, however, better techniques and more data have made it possible to identify systematic differences in people’s preferences and beliefs and to relate them to various measures of cultural legacy. These developments suggest an approach to introduce cultural-based explanations that can be tested and are able to substantially enrich our understanding of economic phenomena. This paper summarizes this approach and its achievement so far, outlining the end directions for future research.
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