Culture and Leadership

Question 1

Culture

Answer 1

General shared social understanding, resulting in commonly held
assumptions and views of the world among organizational members

• Differences in culture show a decreased performance for both employees
  after the merger, and subjects underpredicted the extent of this
  decrease.
• Creation of a new hybrid language (or explaining the old language) when
  the merger occurs.

Question 2

Results of merger

Answer 2

• Tension and hostility between the manager of the merged firm and the new employee
• Subjects still place blame on members of the other premerger firm and attribute the post merger difficulty to their lack of competence
• Some successful integration of cultures

Question 3

Trust and entrepreneurial behaviour

Answer 3

+ trust → + probability of becoming an entrepreneur.

Trusting others ↑ the probability of being selfemployed by 1.5 pp.

Question 4

Cultural Biases in Economic Exchange?

Answer 4

• Importance of similarity level
• Negative relation with exposure in newspapers
• Cross-country trade

Question 5

Cultural Biases in Economic Exchange?

Answer 5

• Perceptions rooted in culture are important determinants of economic
  exchange
• Lower bilateral trust leads to less trade between two countries
• Trust among European countries differs in systematic ways, which are
  correlated to their different cultural heritages.
• These differences in trust seem to have economically important effects on
  trade

Question 6

Does Culture affect Economic Outcome? Approach

Answer 6

• Recognize that better techniques and more data have made it possible to relate people’s preferences and beliefs to measures of cultural legacy.
• Summarize a cultural approach that can be tested

Question 7

Does Culture affect Economic Outcome?

Answer 7

• Recognize that better techniques and more data have made it possible to relate people’s preferences and beliefs to measures of cultural legacy.

1) Define culture : customary beliefs and values that ethnic, religious, and social groups transmit fairly unchanged from generation to generation
2) Show that those beliefs and preferences have an impact on economic
outcomes.
3) Claim a causal link

Question 8

The Effect of Culture on Economic Preferences

Answer 8

Results: Catholics are 3.8% more likely and Protestants 2.7% more likely than nonreligious people to view teaching thrift to their children as an important value

Cultural variables are as important as economic variables in
understanding cross-country differences in national savings rates

• Culture affects political preferences
• Catholics, Protestants and Jewish have a more negative attitude toward redistribution than those with no religion.

Trust: Differences across ethnics
Correlation between Trust of Country of Origin and Trust
of Immigrants Relative to Great Britain

Question 9

Trust and Entrepreneurship

Answer 9

+ trust → + probability of becoming an entrepreneur.

Trusting others ↑ the probability of being selfemployed by 1.5 pp.

Question 10

Work Environment and Individual Background: Explaining Regional Shirking Differentials in a Large Italian Firm

Answer 10

• Striking regional shirking differentials within a large Italian bank with branches distributed over the entire country.
• In particular, absenteeism and misconduct episodes are substantially more frequent in the south.

Possible Reasons:
Individual backgrounds
Sorting effects
Different local attributes