Department of Management

The Importance of Cultural Values and Trust for Innovation - A European Study

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    Bing Zhu, Catholic University of Eichstätt-Ingolstadt, GermanyAndré Habisch, Catholic University of Eichstätt-Ingolstadt, Germany
  • John Thøgersen
Cultural values and social capital are important parts of the context that determines countries’ innovation performance (and, hence, economic development). This paper investigates the culture-innovation relationship in a European context, as well as the mediating role of the national level trust in this connection. Data are used to test the hypotheses that a country’s innovation performance is influenced by its cultural value emphases and societal trust, and that the culture-innovation relationship is mediated by societal trust. Based on data from the Global Innovation Index and the European Social Survey covering 27 European countries, we find that innovation at the country level is positively correlated with the level of societal trust and with three cultural value dimensions: “Autonomy vs. Embeddedness”, “Egalitarianism vs. Hierarchy”, and “Harmony vs. Mastery”. A multivariate SEM analysis reveals that when “Autonomy vs. Embeddedness” is controlled, the two other cultural value dimensions are no longer significant. Further, a SEM path analysis confirms that the relationship between cultural values and innovation performances is completely mediated through the level of trust in a society. Overall, “Autonomy vs. Embeddedness” has a stronger total effect than societal trust on a country’s innovation performance, but most of this effect is indirect, mediated through societal trust. Implications of our findings for the corporate level (i.e., entrepreneurs and managers) as well as for the institutional settings (i.e., policy makers) are discussed. It is suggested that for successful innovation to blossom, the actors on both levels should aim at strengthening the cultural emphasis on individual autonomy, institutional integrity and mutual trust.
Original languageEnglish
Article number1850017
JournalInternational Journal of Innovation Management
Issue number2
Pages (from-to)1-28
Publication statusPublished - 2018

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