Culture, perception, and beliefs
Jul 2022

How does culture influence economic behavior?

Culture is a core element of human coexistence and encompasses all areas of life, including the economy. The influence of culture on various economic dimensions is the subject of numerous studies and provides important insights into core issues of economic behavior: Which rules and incentives are needed for a successful corporate culture? What role do cultural values play in financial decisions? How can we identify and change harmful practices based on misbeliefs and misconceptions? Answers to these and other important questions are provided by numerous experts in lectures, interviews, and papers made possible by the UBS Center.

Culture is a core element of human coexistence and encompasses all areas of life, including the economy. The influence of culture on various economic dimensions is the subject of numerous studies and provides important insights into core issues of economic behavior: Which rules and incentives are needed for a successful corporate culture? What role do cultural values play in financial decisions? How can we identify and change harmful practices based on misbeliefs and misconceptions? Answers to these and other important questions are provided by numerous experts in lectures, interviews, and papers made possible by the UBS Center.

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Quotes

Nothing in life is as important as you think it is, while you are thinking about it.
Opinions, 16.4.2013
Daniel Kahneman
You may think you are doing well out of markets and behave quite rationally, but in fact you are being taken for a ‘phool’.
Opinions, 2.6.2016
Nobel laureate Robert J. Shiller
We are taking the pain of paying away completely.
Opinions, 24.1.2018
Dan Ariely
Not cultural divergence has increased, but nationalism.
Forum for Economic Dialogue, 12.11.2018
Guido Tabellini
The higher the GDP per capita in a country, the greater the variance in cultural preferences between women and men.
Forum for Economic Dialogue, 12.11.2018
Armin Falk
People want to work for a company that shares their vision and values.
Forum for Economic Dialogue, 12.11.2018
Simona Scarpaleggia
WEIRD people are often far removed from the means of distribution, for example when it comes to loyalty to one’s own group and fairness towards strangers.
Forum for Economic Dialogue, 12.11.2018
Joe Henrich
Effective leaders recognize the power of words. The words a leader uses, and how they are delivered, can greatly affect the extent to which workers exert effort in pursuit of a common goal. In many instances, words may have a stronger effect than financial incentives.
UBS Center Public Paper No 3
Roberto Weber
Those firms in which the employees perceive their top managers as trustworthy and ethical in their business practices show higher productivity and profits.
UBS Center Public Paper No 7
Ernst Fehr
Economic and institutional forces do not automatically lead to cultural convergence.
UBS Center Policy Brief No 3/18
Josef Zweimüller
The vast majority of young married men in Saudi Arabia privately support the participation of women in the labor market.
UBS Center Policy Brief No 1/19
David Yanagizawa-Drott

Publications

The UBS Center offers two publication series. The Public Paper series makes research on topics of key social relevance available to a broader audience in a simplified, compact, and highly readable format. The Policy Brief series can give governments and businesses the rigorous and clear insights necessary for informed debates and decisions. They are a condensed and non-technical version of some of our top research papers.

The economics of effective leadership

Economists have typically assumed that the only way, as a leader, to get people to do things is to use carrots (e.g., pay raises) or sticks (e.g., threats of firing) to incentivize the behavior. One of the important contributions of recent research on leadership is to test the extent to which this really is true. Can leaders also motivate and inspire workers with their statements and speeches? Or, is the creation of hard incentives the only way to get followers to do something? Public paper No. 3 by Roberto Weber overviews the development in economic science on this subject.

Behavioral foundations of corporate culture

A sound corporate culture drives a company’s overall performance sustainably – this is not only common sense, but also evidenced in research. Why is culture so important for economic success, and what are the characteristics of a successful corporate culture? Public Paper No 7 by Ernst Fehr puts cooperation and feedback center stage.

Culture and work attitude – Varations in unemployment duration across the Swiss language border

To what extent can differences in culture and attitudes towards work explain differences in unemployment across time and space? Policy brief No. 3/18 by Josef Zweimüller examines variations in the time that unemployed people in Switzerland spend looking for work, comparing residents of Swiss nationality who speak German with residents who speak French or Italian.

Trapped by misperceptions – Women, work, and social norms in Saudi Arabia

Employment rates for women in Saudi Arabia are very low. By custom, they cannot decide for themselves whether to work or not – they need the consent of their male guardian (either their husband or father). Whether men permit their wives or daughters to work depends crucially on social norms. Policy brief No 1/19 by David Yanagizawa-Drott reports evidence that most Saudi men privately believe that women should be allowed to work, but that they underestimate the extent to which other men share their views.

The UBS Center offers two publication series. The Public Paper series makes research on topics of key social relevance available to a broader audience in a simplified, compact, and highly readable format. The Policy Brief series can give governments and businesses the rigorous and clear insights necessary for informed debates and decisions. They are a condensed and non-technical version of some of our top research papers.

The economics of effective leadership

Economists have typically assumed that the only way, as a leader, to get people to do things is to use carrots (e.g., pay raises) or sticks (e.g., threats of firing) to incentivize the behavior. One of the important contributions of recent research on leadership is to test the extent to which this really is true. Can leaders also motivate and inspire workers with their statements and speeches? Or, is the creation of hard incentives the only way to get followers to do something? Public paper No. 3 by Roberto Weber overviews the development in economic science on this subject.

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Event highlights

The Center’s events come in different formats, including two annual conferences with leading representatives from the academic, private, and public sectors debating a key contemporary economic issue. The Opinion events feature top representatives from academia to voice their views in public speeches. The Center hosted several events on the topic of inequality, opportunities, and development in the past 10 years.

Thinking, Fast and Slow – Opinion 2013

At this UBS Center Opinion event, Nobel laureate Daniel Kahneman gave an overview of his book “Thinking, Fast and Slow.” Kahneman distinguishes between fast thinking and slow thinking. Slow thinking could be described as conscious, informed thinking, fast thinking as unconscious and instinct. Both slow and fast thinking are part of human nature, as are risk aversion and optimism. According to Kahneman, people respond more strongly to losses than to gains.

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Phishing for phools - The economics of manipulation and deception – Opinion 2016

Economic models tend to assume that people are informed about the decisions they make, so that consumers are able to make markets work to their advantage. At this UBS Center Opinion event, Nobel laureate Robert Shiller argued that this assumption is at least partially wrong, as many competitive markets by their very nature spawn deception and trickery.

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Dollars and Sense – Opinion 2018

Despite our intentions, why do we so often fail to act in our own best interest? Why does paying for things often feel like it causes physical pain? Why do we overvalue things that we’ve worked to put together? What are the forces that influence our behavior? Dan Ariely, James B. Duke Professor of Psychology & Behavioral Economics at Duke University, came to Zurich to answer these questions at the UBS Center Opinion event.

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Is culture key? New insights on how culture affects economic prosperity – Forum for Economic Dialogue 2018

Culture and economics are closely interlinked: a country’s economic success depends on the quality of its culture. This insight is not new, yet, it has long been ignored. It has returned, however, to the center of economists’ attention, at the 2018 Forum for Economic Dialogue, with experts such as Sir Paul Collier, Armin Falk, Alessandra Fogli, Joe Henrich, Alan Posener, Raffaela Sadun, Simona Scarpaleggia and Guido Tabellini.

Learn more

The Center’s events come in different formats, including two annual conferences with leading representatives from the academic, private, and public sectors debating a key contemporary economic issue. The Opinion events feature top representatives from academia to voice their views in public speeches. The Center hosted several events on the topic of inequality, opportunities, and development in the past 10 years.

Thinking, Fast and Slow – Opinion 2013

At this UBS Center Opinion event, Nobel laureate Daniel Kahneman gave an overview of his book “Thinking, Fast and Slow.” Kahneman distinguishes between fast thinking and slow thinking. Slow thinking could be described as conscious, informed thinking, fast thinking as unconscious and instinct. Both slow and fast thinking are part of human nature, as are risk aversion and optimism. According to Kahneman, people respond more strongly to losses than to gains.

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In the media

  • Im Dauereinsatz für mehr Diversität Finanz und Wirtschaft vom 12.11.2018 lesen

  • Wie wichtig Kultur für den Erfolg ist Tagesanzeiger vom 21.11.2018 lesen

  • Warum Europas Staaten sich nicht näherkommen NZZ vom 21.11.2018 lesen

  • Ehe und Erben: Joseph Henrich erklärt den Aufstieg des Westens NZZ vom 4.12.2018 lesen

  • Behavioral Foundations of Corporate Culture Harvard Law School Forum vom 12.3.2019 read

  • Moving the needle on social norms Worldbank Blogs vom 30.5.2019 read

Promoting dialogue