A Theory of Strategic Uncertainty and Cultural Diversity

• Willemien Kets ^[1] ; Alvaro Sandroni ^[2]
  1. [1] University of Oxford

     University of Oxford

     Oxford District, Reino Unido

     
  2. [2] Northwestern University

     Northwestern University

     Township of Evanston, Estados Unidos

     
• Localización: Review of economic studies, ISSN 0034-6527, Vol. 88, Nº 1, 2021, págs. 287-333
• Idioma: inglés
• Texto completo no disponible (Saber más ...)
• Resumen

  • We identify a new mechanism through which cultural diversity affects economic outcomes, based on a model of culture as shared cognition. Under this view, cultural diversity matters because it increases strategic uncertainty. The model can help better understand a variety of disparate evidence, including why homogeneous societies can be more conformist, why diverse societies may get stuck in a low-trust trap, why companies with a strong culture may fail to adopt superior work practices, and why autocratic rulers in diverse societies may overinvest in state capacity.