How do cultural values influence entrepreneurial behavior of nations? A behavioral reasoning approach

Despite an abundance of research, still there is a gap in understanding the underlying cultural mechanisms behind entrepreneurial behavior of nations in the literature. This study contributes to the debate through a new perspective of analysis based on behavioral reasoning theory (BRT). Specifically, this research analyses the role cultural values play in formation of the reasoning behind entrepreneurial behavior. The data and variables are taken from the GLOBE project and the Global Entrepreneurship Monitor (GEM) for a multiple regression analysis spanning from 2007 to 2017 for 50 countries. The results show that, with the exception of Institutional Collectivism, all of GLOBE’s cultural dimensions affect the reasoning justifications behind entrepreneurial intentions in various countries. Thus, the novel contribution of the present research is the application of BRT in explaining entrepreneurial intentions. This contribution is substantial to the international entrepreneurship field through clarification of the role of cultural values in the reasoning processes behind entrepreneurial activities of nations. Some findings are surprising with regard to the conventional understandings. These findings are fully discussed in the concluding sections.     

Macro-level determinants of formal entrepreneurship versus informal entrepreneurship

Based on the eclectic theory of entrepreneurship, this article analyzes macro-level determinants of national rates of formal versus informal entrepreneurship. Our evaluation of the factors identified in this theory reveals a set of empirically-testable, higher-order determinants: economic opportunities, quality of governance, macro-level resources and abilities, performance-based culture and socially-supportive culture. The results of our analysis obtained through the PLS (partial least squares) approach to structural equation modeling contribute to the entrepreneurship literature by providing an empirically-supported model that shows how formal and informal entrepreneurship are driven differently. This model clarifies the conflicting findings in previous research about the effects of socioeconomic, institutional, and cultural factors on entrepreneurship rates across countries. Finally, by showing the effect of each determinant on formal and informal entrepreneurship, this study has important implications for policymakers as well as businesses.     

An empirical assessment of cross‐cultural age self‐construal measurement: Evidence from three countries

This study investigated which age measures, independent or interdependent, were better for cross‐cultural consumer research. Specifically, it assessed the fit between the “actual” and “ideal” self‐concept model within the framework of self‐construal theory by examining the actual and ideal self‐attributed age identity across South Korea ( n = 480), China ( n = 207), and France ( n = 338) using both independent and interdependent age identity scales. Multivariate analyses revealed differences for individuated self‐schemata across the three countries for actual and ideal age self‐construal, as well as for actual other‐referent interdependent age self‐schemata. However, the reverse occurred too: The ideal interdependent ages showed a lack of difference across the three different cultures. Overall, the results indicate that interdependent decade scales are better than independent age scales for cross‐cultural consumer behavior studies. Though such scales are more complex, they are easy to translate and to administer, and simple to analyze and to interpret. Evidence also suggests that such scales are reliable and robust across disparate samples in the countries studied. © 2011 Wiley Periodicals, Inc.     

Formal institutions, culture, and venture capital activity: A cross-country analysis

Why does the level of venture capital activity vary across countries? This study suggests that the variation can be attributed to the different levels of formal institutional development. Further, this study proposes that venture capitalists respond differently to the incentives provided by formal institutions depending on different cultural settings. Analysis of VC activity for 68 countries during the 1996-2006 period shows that formal institutions have a positive effect on the level of venture capital activity, but this effect is weaker in more uncertainty-avoiding societies and in more collectivist societies. This study has useful theory and policy implications for venture capital and entrepreneurship development.     

Nationality and work role interactions: A cultural contrast of Israeli and U.S. entrepreneurs' versus managers' needs

The globalization of business ventures and the parallel search for sources of international competitive advantage have stimulated research relating cultural differences to entrepreneurial and managerial behaviors. Recent work by McGrath, MacMillan, and Scheinberg (1992) encouraged studies of managers and entrepreneurs in different cultures, suggesting that these comparisons may “… shed additional light into the interrelations between social structure, wealth creation, and cultural beliefs” (McGrath el at. 1992, p. 116). This study follows that advice.Cultural differences are powerful determinants of behavior, and many studies support the notion that managerial behavior must adapt to the national cultural setting to achieve success. A growing stream of entrepreneurial behavior research has explored differences in motivational needs between entrepreneurs and non-entrepreneurs of different countries, and found parallel differences across cultures. Given these views, we might expect to find need differences between entrepreneurs and managers within countries however, some entrepreneurship researchers have concluded that U.S. managers and entrepreneurs are more alike than different.To better understand need profile differences between and within cultures, we use a theory that suggests that culture is an important determinant of work behavior. The process through which culture affects work behaviors is described in “Cultural Self-representation Theory” (Erez and Earley, 1993). Based upon this theory, inferences from the entrepreneurial archetype, and analysis of the contrast between the cultures of Israel and the U.S., we propose that: (1) entrepreneurs and managers have different motivational needs within some national cultures, and (2) across national cultures there are systematic differences in motivational needs. Based on these premises, an interaction hypothesis between work role and nationality is suggested because of the importance of both culture and work role in determining motivational need differences. Data are collected from over 370 Israeli and U.S. entrepreneurs and managers.Results support cultural self-representation theory for the Israeli-U.S. and entrepreneur-manager case, because interactions between nationality and work role are exposed for various needs. This finding suggests that cultural differences are indeed important for understanding management motivational needs in different nations, and that the effectiveness of entrepreneurial approaches to management may be culture-sensitive. The study illustrates work-role differences between Israeli managers and entrepreneurs. We confirm past conclusions about U.S. entrepreneur-manager need similarities, and suggest that these need similarities are supported by the individualistic culture within U.S. organizations.     

The interplay of entrepreneurship education and national cultures in entrepreneurial activity: a social cognitive perspective

Does entrepreneurship education result in entrepreneurial activities across national cultures? For the most part, prior research has examined the relationship between entrepreneurship education and entrepreneurial activity, using country-specific samples. However, many of these results are inconsistent. One reason for such inconsistent results may be a limitation of country-specific samples, given that they are valid in a domestic context but not generalizable. Our study addresses this limitation by using a cross-national sample of 24,457 respondents from 38 countries to examine the role of diverse national cultures. Building on the social cognitive theory, our results show that entrepreneurship education is more seminal for entrepreneurial activities that take place in countries with greater individualism, less uncertainty avoidance, and a high level of masculinity. This research presents a more complete picture of how entrepreneurship education may affect international entrepreneurship contingent upon national culture, and has implications for researchers, educators, and policy makers.     

International entrepreneurship in resource-rich landlocked African countries

Despite the increase in research about international entrepreneurship, relatively little is known about the process in Africa. This is due to the disparity between the actualization of business ventures and global perceptions of African entrepreneurs. As a result of the diversity of countries within the African continent, the nature of international entrepreneurship varies with cultural and historical context. To address this research gap, we discuss how international entrepreneurship in Africa differs to the more studied traditionally North American and European perspective. To do this we develop a number of research propositions for resource-rich landlocked African countries (Botswana, Zambia, and Zimbabwe) that have unique characteristics in terms of how they approach international entrepreneurship. The research propositions suggest that resource-rich landlocked African countries need to focus on informal networks and cultural attributes as a way to differentiate themselves in the international marketplace. Managerial implications and theoretical research suggestions for differentiating resource-rich landlocked African countries from the more resource scarce and coastal countries are stated.     

Cross-Country Differences in Entrepreneurial Activity: The Role of Cultural Practice and National Wealth

In this paper, we argue that national culture is important in interpreting the differences of entrepreneurial activities between countries. Furthermore, national wealth plays a moderating role between national culture and entrepreneurial activities. Datasets from the Global Leadership and Organizational Behavior Effectiveness (GLOBE) project and Global Entrepreneurship Monitor (GEM) study were analyzed. We find that there are interaction effects between GDP, a proxy for national wealth, and several cultural dimensions on entrepreneurial activities. More traditional cultural variables (in-group collectivism, humane orientation, and power distance) enhance early-stage and established entrepreneurship in low- and medium-GDP countries, but hinder early-stage and established entrepreneurship in high-GDP countries. More modernistic cultural variables (performance orientation, future orientation, and uncertainty avoidance) promote high-growth and high-innovation entrepreneurship in some situations, especially in high-GDP countries. Implications and limitations are discussed.     

Managing Opportunism in China: The Roles of Guanxi,Environmental Uncertainty,and Management Culture

ABSTRACT

This cross-cultural comparison aims to understand whether the influence of consumer ethnocentrism (CE) on consumer preference for domestic versus foreign products is product category and country-of-origin dependent. Three countries with dissimilar cultural orientation and economic status—China, South Korea, and the United States—were examined. American consumers were found to be more ethnocentric than Chinese and South Korean consumers. CE was found to significantly and positively predict American and Korean consumers’ preference for domestic products across product categories, while Chinese consumers’ CE did not translate into their preference for Chinese products. In addition, the relationship between CE and purchase preference varied across product categories as well as countries of origin.     

Using fuzzy-set qualitative comparative analysis for a finer-grained understanding of entrepreneurship

Entrepreneurship theory has largely been developed and tested using symmetrical correlational methods, effectively describing the sample-average respondent and subsuming individual differences. Such methods necessarily limit investigation of asymmetries that are evident in entrepreneurship, and provide only a single explanation that belies the multiple pathways to entrepreneurship observed in practice. This paper employs a case-based approach—fuzzy-set Qualitative Comparative Analysis (fsQCA)—to identify configurations of antecedent attributes of individuals in groups within samples, thereby revealing asymmetries and multiple entrepreneurial pathways that are otherwise hidden in the data. We explain the application of fsQCA to reveal these common issues in entrepreneurship; demonstrate how fsQCA complements correlational methods and offers finer-grained understanding of individual entrepreneurial behavior; and offer a comprehensive research agenda to build new entrepreneurship theory.     

Nudity of female and male models in primetime TV advertising across seven countries

This study partially replicates and extends previous research on nudity by examining TV advertising across multiple countries (Brazil, Canada, China, Germany, South Korea, Thailand and the United States) and by incorporating multiple factors (cultural values, advertising regulation and product type). Results show that female (but not male) nudity differed substantially across countries, and females were portrayed in greater states of undress than males. US and Chinese commercials showed the lowest level of nudity, whereas German and Thai ads showed the highest level. Cultural values (masculinity/ femininity) and advertising regulation (pre-clearance policy) explain only minimally the degree of model nudity in ads across the countries. Although each of the three factors offers some value for predicting degrees of male and female nudity, congruent product category appears to be the most significant predictor, supporting a match-up hypothesis and congruency theory. Results are discussed in terms of global advertising strategy.     

Exploring country-level institutional arrangements on the rate and type of entrepreneurial activity

This study introduces a novel multidimensional measure of the entrepreneurial environment that reveals how differences in institutional arrangements influence both the rate and the type of entrepreneurial activity in a country. Drawing from institutional theory, the measure examines the regulatory, normative, and cognitive dimensions of entrepreneurial activity, and introduces a novel conducive dimension that measures a country's capability to support high-impact entrepreneurship. Our findings suggest that differences in institutional arrangements are associated with variance in both the rate and type of entrepreneurial activity across countries. For the formation of innovative, high-growth new ventures, the regulative environment matters very little. For high-impact entrepreneurship an institutional environment filled with new opportunities created by knowledge spillovers and the capital necessary for high-impact entrepreneurship matter most.     

Convergence and divergence in consumer behavior: implications for international retailing

Converging technology and disappearing income differences across countries will not lead to homogenization of consumer behavior. Rather, consumer behavior will become more heterogeneous because of cultural differences. As consumer incomes converge across countries, the manifestation of value differences will become stronger. This phenomenon makes it increasingly important to understand values of national cultures and their impact on consumer behavior. Retailing strategies for one country cannot be extended to other countries without adaptation. Hofstede’s model of national culture is applied to understand differences in consumer behavior across countries. Examples are provided of consumption differences, their relationships with culture discussed, and selected implications for international retailing management detailed.     

Risky choices in new venture decisions—experimental evidence from Germany and the United States

This article presents a model of entrepreneurial risk-taking behavior in different cultural settings. Young entrepreneurs and entrepreneurship students in Germany and the United States were tested by means of an experimental design to evaluate the underlying model and to identify cultural differences in the decision to start a company. The central research question states: How does the cultural context influence the decision-making and risk-taking behavior of entrepreneurs? The overall result of the international sample indicates that the significant differences between entrepreneurs and nonentrepreneurs in risk-taking behavior are culturally driven. Thus, this study extends earlier US studies that distinguish between risk propensity and risk perception in respect of entrepreneurs’ risk behavior within an international, intercultural sample. Furthermore, the survey researches the influence of the personal traits overconfidence and worry. From a managerial perspective, “would-be entrepreneurs” can use the conducted experiment as an individual diagnostic instrument, making it possible to identify individual anomalies in risk and decision-making behavior and, consequently, contribute to a better understanding of suitable entrepreneurial behavior as well as to reveal discrepancies between self-assessment and actual behavior.     

Gender gap in latent and nascent entrepreneurship: driven by competitiveness

This study highlights the relevance of gender differences in competitiveness for the gender gap in latent and nascent entrepreneurship. Using data obtained from a recent large-scale survey conducted in 36 countries, we find that individuals who like situations in which they compete with others are more likely to have a preference for being self-employed (latent entrepreneurs) and are also more likely to take steps to start new businesses (nascent entrepreneurs). Moreover, our results suggest that women are less competitively inclined than men in almost all countries in our sample and are also less willing to take risks. The results of a decomposition analysis suggest that gender differences in competitiveness and risk taking contribute significantly to the gender gap in latent and nascent entrepreneurship. Gender differences in competitiveness seem to be relevant, especially for the gender gap in nascent entrepreneurship.     

A new perspective on entrepreneurial regions: linking cultural identity with latent and manifest entrepreneurship

What are the entrepreneurial places in the USA? Although seminal theorizing on the determinants of entrepreneurship gives culture a unique and important role, systematic empirical evidence linking the distinct cultural identity of regions to their local entrepreneurial spirit and vitality is still scarce. This study offers a first, systematic overview on the nexus between regional cultural identity and latent and manifest entrepreneurship across the USA. To directly assess regional cultural identity, we apply the American Nations and Patchwork Community Types approaches and explore in which way these distinct spatially based cultural regions are reflected by significant differences in entrepreneurial activity and underlying biologically based propensities. We combine annual entrepreneurship rates at the county level with personality data collected in a large-scale, Internet-based study of 3,457,270 US residents. The findings suggest that entrepreneurship culture reflects the dynamic interplay between the region’s cultural identity and its latent and manifest entrepreneurship.     

Entrepreneurship in the EU: To Wish and not to be

The entrepreneurial capacity in an economy is a key determinant of economic growth and productivity improvements. This paper uses survey data from the 15 EU Member States and the US to investigate two aspects of entrepreneurial capacity: latent and actual entrepreneurship. Latent entrepreneurship is measured by the probability of a declared preference for self-employment over employment. Other than demographic variables such as gender, age and education level, the set of explanatory variables used includes country specific effects, the perception by respondents of administrative complexities and of availability of financial support and a rough measure of risk tolerance. The most striking result is the lack of explanatory power of the perception of lack of available financial support in the latent entrepreneurship equation.     

Culture, entrepreneurial orientation, and global competitiveness

Based on Lumpkin and Dess’s conceptualization of entrepreneurial orientation (EO), this paper presents a cultural model of entrepreneurship. We propose that a society’s propensity to generate autonomous, risk-taking, innovative, competitively aggressive and proactive entrepreneurs and firms will depend on its cultural foundation. The role of economic, political/legal, and social factors as moderators of the relationship between culture and entrepreneurial orientation (EO) are also considered. Overall, it is proposed that only those countries with specific cultural tendencies will engender a strong EO, hence experiencing more entrepreneurship and global competitiveness. Specific country examples are discussed.     

Typology of diaspora entrepreneurship: Case studies in Uzbekistan

The characteristics and importance of transnational diasporans as entrepreneurs for the economy and international business of emerging countries have remained underexplored. This paper addresses types of diaspora entrepreneurship (DE) theoretically and empirically in the context of Uzbekistan. Diaspora entrepreneurship is often seen as necessity-driven and less opportunity-driven. So far, emerging Central-Asian countries are considered countries of origin (COOs) of diasporans, but not yet as countries wherein diasporans want to invest and work, that is, countries of residence (CORs). Uzbekistan is also a post-Soviet economy with limited tradition on private entrepreneurship. Thus, the paper asks what makes people become entrepreneurs in emerging countries such as Uzbekistan when they have alternative opportunities in developed countries. It explores key drivers and socio-cultural reasons for the entry and establishment decision and introduces a typology of DE. This multiple case study presents implications and findings on culturally different entrepreneurs who have decided to enter Uzbek business elucidating their motivations and role in transition economies.     

Entrepreneurship in Emerging Markets: New Insights and Directions for Future Research

In recent years, the entrepreneurship and emerging markets research streams have intersected. Emerging markets provide an opportunity to examine entrepreneurship in different contexts and forms. This article discusses the current literature that interconnects both research streams in general, comments on the contributions of the articles published in the special issue on entrepreneurship and emerging markets in particular, and sketches out future avenues for research. These contributions span several theoretical lenses, including institutional theory, internationalization theory, transaction cost economics, and the resource‐based view, as well as multiple geographic regions, including China as the largest emerging economy and other countries in East Asia, Central Asia, South Asia, Eastern Europe, Latin America, the Caribbean, and the Middle East. We weave a discussion of the extant literature and these contributions inside three key themes: Emerging Markets and China's Uniqueness, Entrepreneurship in Emerging Markets, and Future Research on Emerging Markets Entrepreneurship. © 2013 Wiley Periodicals, Inc.