CH 2 IB Flashcards
indicators of culture
religion and language
Informal institutions
- exist in norms, values and ethics
- complement formal institutions (when formal institutions are unclear or fail, informal institutions play a larger role in reducing uncertainty)
Origin of informal instituions
- are an inheritance of culture
What is culture?
collective programming of the mind that distinguishes the members of one group from others
artefacts of culture
visible surface of culture
Three ways of understanding cultural differences
context, clusters, dimension
The context approach
context is the underlying background upon which interaction takes place
low context cultures
North America…
high context cultures
Arab and Asian countries
clusters
countries that share similar cultures are grouped together as one cluster.
three important clusters
Ronen and Shenkar Clusters, GLOBE Clusters and the Huntington Civilizations.
Hofstede’s five cultural dimensions
Individualism (identity of an individual is fundamentally his or her own) vs. collectivism Masculinity vs. femininity Power distance Long-term orientation uncertainty avoidance
corporate language
language used to communicate between entities of the same MNE, located in different countries
lingua franca
most used language in global business
taboo
item or activity that is considered unclean
secular societies
religion does not dominate public life
ethics
principles, standards and norms that govern individual and firm behavior
codes of conduct
guidelines for making ethical decisions
ethical relativism
all ethical standards are relative.
the doctrine that there are no absolute truths in ethics and that what is morally right or wrong varies from person to person or from society to society.
ethical imperialism
there is only one set of ethics
corruption
the abuse of public power for private benefits
