Advertisement

Redistribution and the Individualism–Collectivism Dimension of Culture

  • Carola Conces Binder
Article

Abstract

This paper examines the relationship between culture and redistribution, focusing on the individualism–collectivism dimension of culture. Perhaps surprisingly, countries with more individualistic cultures have significantly greater income redistribution and lower after-tax income inequality. This finding also holds when using instruments for individualism suggested by the literature on cross-cultural psychology, including historical pathogen prevalence and linguistic and genetic characteristics. The association between individualism and redistribution is driven by higher-income countries, which appear to be influenced by a distinct strain of individualism. Data from the World Values Survey reveals that in higher income countries, individualism is positively correlated with generalized trust and tolerance of outsiders and negatively correlated with belief in traditional gender roles. In lower income countries, individualism is associated with a stronger emphasis on self-reliance and the benefits of competition.

Keywords

Inequality Redistribution Culture Individualism Collectivism Social norms Values 

JEL Classification

D30 D31 D63 Z10 O15 

References

  1. Acemoglu, D., Naidu, S., Restrepo, P., & Robinson, J. (2015). Handbook of income distribution, Vol. 2, Chap. Democracy, redistribution and inequality. North-Holland: Elsevier.Google Scholar
  2. Alesina, A., & Angeletos, G.-M. (2005). Fairness and redistribution. American Economic Review, 95, 960–980.CrossRefGoogle Scholar
  3. Alesina, A., Di Tella, R., & MacCulloch, R. (2004). Inequality and happiness: Are Europeans and Americans different? Journal of Public Economics, 88, 2009–2042.CrossRefGoogle Scholar
  4. Alesina, A., & Giuliano, P. (2011). Handbook of social economics, Chap. Preferences for redistribution (pp. 93–132).Google Scholar
  5. Alesina, A., & Giuliano, P. (2015). Culture and institutions. Journal of Economic Literature, 53, 898–944.CrossRefGoogle Scholar
  6. Alesina, A., & Glaeser, E. (2004). Fighting poverty in the US and Europe: A world of difference. Oxford: Oxford University Press.CrossRefGoogle Scholar
  7. Algan, Y., & Cahuc, P. (2014). Handbook of economic growth, Vol. 2A, Chap. Trust, growth, and well-being: New evidence and policy implications (pp. 49–120). Elsevier.Google Scholar
  8. Arrow, K. (1963). Social choice and individual values. New York: Wiley.Google Scholar
  9. Arrow, K. (1971). Frontiers of quantitative economics, Chap. Political and economic evaluation of social effects and externalities. Amsterdam: North-Holland.Google Scholar
  10. Atkinson, A., & Brandolini, A. (2009). On data: A case study of the evolution of income inequality across time and across countries. Cambridge Journal of Economics, 33, 381–404.CrossRefGoogle Scholar
  11. Ball, R. (2001). Individualism, collectivism, and economic development. Annals of the American Academy of Political and Social Science, 573, 57–84.CrossRefGoogle Scholar
  12. Besley, T., & Persson, T. (2009). Origins of state capacity: Property rights, taxation and politics. American Economic Review, 99, 1218–1244.CrossRefGoogle Scholar
  13. Bond, M. H. (2002). Reclaiming the individual from Hofstede’s ecological analysis—A 20-year odyssey: Comment on Oyserman et al. (2002). Psychological Bulletin, 128, 73–77.CrossRefGoogle Scholar
  14. Bouchard, T. J, Jr., & McGue, M. (2003). Genetic and environmental influences on human psychological differences. Journal of Neurobiology, 54, 4–45.CrossRefGoogle Scholar
  15. Brewer, P., & Venaik, S. (2011). Individualism–collectivism in Hofstede and GLOBE. Journal of International Business Studies, 42, 436–445.CrossRefGoogle Scholar
  16. Chiao, J. Y., & Blizinsky, K. D. (2010). Culture–gene coevolution of individualism–collectivism and the serotonin transporter gene. Proceedings of the Royal Society: Biological Sciences, 277, 529–537.CrossRefGoogle Scholar
  17. Clark, R. (2013). Convergence in national income distributions. Social Forces, 92, 413–436.CrossRefGoogle Scholar
  18. Coleman, J. (1990). Foundations of social theory. Cambridge, MA: Harvard University Press.Google Scholar
  19. Corneo, G. (2001). Inequality and the state: Comparing US and German preferences. Annales d’Economie et de Statistique, 63(64), 283–96.CrossRefGoogle Scholar
  20. Corneo, G., & Grüner, H. P. (2002). Individual preferences for political redistribution. Journal of Public Economics, 83, 83–107.CrossRefGoogle Scholar
  21. Cukur, C. S., De Gusman, M. R. T., & Carlo, G. (2004). Religiosity, values, and horizontal and vertical individual collectivism: A study of Turkey, the United States, and the Phillipines. The Journal of Social Psychology, 144, 613–634.CrossRefGoogle Scholar
  22. Fevre, R. (2003). The new sociology of economic behaviour. London: Sage.Google Scholar
  23. Fevre, R. (2016). Individualism and inequality: The future of work and politics. Cheltenham: Edward Elgar Publishing.CrossRefGoogle Scholar
  24. Fincher, C. L., Thornhill, R., Murray, D. R., & Schaller, M. (2008). Pathogen prevalence predicts human cross-cultural variability in individualism/collectivism. Proceedings of the Royal Society: Biological Sciences, 275, 1279–1285.CrossRefGoogle Scholar
  25. Gelfand, M. J., Bhawuk D. P. S., Nishii, L. H., & Bechtold, D. J. (2004). Culture, leadership, and organizations: The GLOBE study of 62 societies, Chap. Individualism and collectivism (pp. 437–512). Thousand Oaks, CA: Sage Publications.Google Scholar
  26. Glaeser, E. L., La Porta, R., de Silane, F. L., & Shleifer, A. (2004). Do institutions cause growth? Journal of Economic Growth, 9, 271–303.CrossRefGoogle Scholar
  27. Gorodnichenko, Y., & Roland, G. (2011). Which dimensions of culture matter for long-run growth? American Economic Review: Papers and Proceedings, 101, 492–498.CrossRefGoogle Scholar
  28. Gorodnichenko, Y., & Roland, G. (2012). Understanding the individualism–collectivism cleavage and its effects: Lessons from cultural psychology. In M. Aoki, T. Kuran, & G. Roland (Eds.), Institutions and comparative economic development. International economic association series. London: Palgrave Macmillan.Google Scholar
  29. Gorodnichenko, Y., & Roland, G. (2017). Culture, institutions and the wealth of nations. Review of Economics and Statistics, 99, 402–416.CrossRefGoogle Scholar
  30. Greif, A. (1994). Cultural beliefs and the organization of society: A historical and theoretical reflection on collectivist and individualist societies. Journal of Political Economy, 102, 912–950.CrossRefGoogle Scholar
  31. Guiso, L., Sapienza, P., & Zingales, L. (2006). Does culture affect economic outcomes? Journal of Economic Perspectives, 20, 23–48.CrossRefGoogle Scholar
  32. Heine, S. J. (2007). Cultural psychology. New York: W. W. Norton & Company.Google Scholar
  33. Hofstede, G. (1980). Cultures consequences: International differences in work-related values. Beverly Hills, CA: Sage.Google Scholar
  34. Hofstede, G. (1991). Cultures and organizations: Software of the mind. London: McGraw-Hill.Google Scholar
  35. Hofstede, G. (2001). Culture’s consequences: Comparing values, behaviors, and organizations across nations (2nd ed.). London: Sage Publications.Google Scholar
  36. Hofstede, G. (2006). What did GLOBE really measure? Researchers’ minds versus respondents’ minds. Journal of International Business Studies, 37, 882–896.CrossRefGoogle Scholar
  37. Hofstede, G. (2011). Dimensionalizing cultures: The Hofstede model in context. Online Readings in Psychology and Culture, International Association for Cross-Cultural Psychology, 2, 8.Google Scholar
  38. House, R., Javidan, M., Hanges, P., & Dorfman, P. (2002). Understanding cultures and implicit leadership theories across the globe: An introduction to project GLOBE. Journal of World Business, 37, 3–10.CrossRefGoogle Scholar
  39. Inglehart, R. F., Borinskaya, S., Cotter, A., Harro, J., Inglehart, R. C., Ponarin, E., et al. (2014). Genetic factors, cultural predispositions, happiness and gender equality. Journal of Research in Gender Studies, 4, 32–100.Google Scholar
  40. Jolliffe, I. T. (2002). Principal component analysis. New York: Springer.Google Scholar
  41. Kagitcibasi, C. (1997). Handbook of cross-cultural psychology, Vol. 3, Chap. Individualism and collectivism (pp. 1–51). Needham Heights, MA: Allyn and Bacon.Google Scholar
  42. Kashima, E., & Kashima, Y. (1998). Culture and language: The case of cultural dimensions and personal pronoun use. Journal of Cross-Cultural Psychology, 29, 461–486.CrossRefGoogle Scholar
  43. Kashima, Y., & Kashima, E. (2003). Individualism, GNP, climate, and pronoun drop: Is individualism determined by affluence and climate, or does language use play a role? Journal of Cross-Cultural Psychology, 34, 125–134.CrossRefGoogle Scholar
  44. Kaufmann, D., Kraay, A., & Mastruzzi, M. (2010). The worldwide governance indicators: A summary of methodology, data and analytical issues. World Bank Policy Research Working Paper.Google Scholar
  45. Kim, U., Triandis, H. C., Kagitcibasi, C., Choi, S.-C., & Yoon, G. (1994). Individualism and collectivism: Theory, method, and applications. Thousand Oaks, CA: Sage.Google Scholar
  46. Klasing, M. J. (2013). Cultural dimensions, collective values and their importance for institutions. Journal of Comparative Economics, 41, 447–467.CrossRefGoogle Scholar
  47. Licht, A. N., Goldschmidt, C., & Schwartz, S. H. (2007). Culture rules: The foundations of the rule of law and other norms of governance. Journal of Comparative Economics, 35, 659–688.CrossRefGoogle Scholar
  48. Macfarlane, A. (1979). The origins of english individualism. Cambridge: Cambridge University Press.Google Scholar
  49. Mill, J. S. (1843). A system of logic. London: Longmans, Green and Co.Google Scholar
  50. Mokyr, J. (1990). The lever of riches: Technological creativity and economic progress. Oxford: Oxford University Press.Google Scholar
  51. Murray, D. R., & Schaller, M. (2010). Historical prevalence of infectious diseases within 230 geopolitical regions: A tool for investigating origins of culture. Journal of Cross-Cultural Psychology, 41, 99–108.CrossRefGoogle Scholar
  52. Oyserman, D., Coon, H. M., & Kemmelmeier, M. (2002). Rethinking individualism and collectivism: Evaluation of theoretical assumptions and meta-analyses. Psychological Bulletin, 128, 3–72.CrossRefGoogle Scholar
  53. Piketty, T., & Saez, E. (2003). Income inequality in the United States, 1913–1998. Quarterly Journal of Economics, 118, 1–41.CrossRefGoogle Scholar
  54. Pitlik, H., & Rode, M. (2017). Individualistic values, institutional trust, and interventionist attitudes. Journal of Institutional Economics, 13, 575–598.CrossRefGoogle Scholar
  55. Rodenwaldt, E., & Bader, R. E. (1952–1961). World-atlas of epidemic diseases. Hamburg: Falk.Google Scholar
  56. Roland, G. (2004). Understanding institutional change: Fast-moving and slow-moving institutions. Studies in Comparative International Development, 38, 109–131.CrossRefGoogle Scholar
  57. Salili, F. (1996). Learning and motivation: An Asian perspective. Psychology and Developing Societies, 8, 55–81.CrossRefGoogle Scholar
  58. Schimmack, U., Oishi, S., & Diener, E. (2005). Individualism: A valid and important dimension of cultural differences between nations. Personality and Social Psychology Review, 9, 17–31.CrossRefGoogle Scholar
  59. Simmons, J. S., Whayne, T., Anderson, G. W., & Horack, H. M. (1944). Global epidemiology: A geography of disease and sanitation. London: J. B. Lippincott Co.Google Scholar
  60. Singelis, T. M., Triandis, H. C., Bhawuk, D. P. S., & Gelfand, M. J. (1995). Horizontal and vertical dimensions of individualism and collectivism: A theoretical and measurement refinement. Cross-Cultural Research, 29, 240–275.CrossRefGoogle Scholar
  61. Smith, A. (1759). The theory of moral sentiments. London: A. Millar.CrossRefGoogle Scholar
  62. Solt, F. (2009). Standardizing the world income inequality database. Social Science Quarterly, 90, 231–242.CrossRefGoogle Scholar
  63. Solt, F. (2015). On the assessment and use of cross-national income inequality datasets. Journal of Economic Inequality, 13, 683–691.CrossRefGoogle Scholar
  64. Spicker, P. (2013). Reclaiming individualism: Perspectives on public policy. Bristol: Policy Press.CrossRefGoogle Scholar
  65. Spolaore, E., & Wacziarg, R. (2013). How deep are the roots of economic development? Journal of Economic Literature, 51, 325–369.CrossRefGoogle Scholar
  66. Tabellini, G. (2008). Presidential address: Institutions and culture. Journal of the European Economic Association, 6, 255–294.CrossRefGoogle Scholar
  67. Tanzi, V. (1994). Corruption, governmental activities, and markets. IMF Working Paper.Google Scholar
  68. Tanzi, V. (1998). Fundamental determinants of inequality and the role of government. International Monetary Fund Working Paper.Google Scholar
  69. Titmuss, R. (1971). The gift relationship: From human blood to social policy. New York: Pantheon Books.Google Scholar
  70. Triandis, H. C. (1995). Individualism and collectivism. Boulder, CO: Westview Press.Google Scholar
  71. Triandis, H. C., Bontempo, R., Betancourt, H., Bond, M., Leung, K., Brenes, A., et al. (1986). The measurement of the etic aspects of individualism and collectivism across cultures. Australian Journal of Psychology, 38, 257–267.CrossRefGoogle Scholar
  72. van Hoorn, A. (2015). Individualist–collectivist culture and trust radius: A multilevel approach. Journal of Cross-Cultural Psychology, 46, 269–276.CrossRefGoogle Scholar
  73. Way, B. M., & Lieberman, M. D. (2010). Is there a genetic contribution to cultural differences? Collectivism, individualism and genetic markers of social sensitivity. Neuroscience, 5, 203–211.Google Scholar
  74. Weber, M. (1930). The protestant ethic and the spirit of capitalism. London: G. Allen and Unwin.Google Scholar
  75. Williamson, O. (2000). The new institutional economics: Taking stocks, looking ahead. Journal of Economic Literature, 38, 595–613.CrossRefGoogle Scholar
  76. Yamagishi, T. (2017). Trust in social dilemmas, Chap. Individualism–collectivism, the rule of law, and general trust. Oxford University Press.Google Scholar

Copyright information

© Springer Nature B.V. 2018

Authors and Affiliations

  1. 1.Department of EconomicsHaverford CollegeHaverfordUSA

Personalised recommendations