Influence of Culture on Macroeconomic Stability
|Author:||Mgr. Jitka Jopová|
|Year:||2015 - winter|
|Leaders:|| PhDr. Jaromír Baxa Ph.D.
|Work type:|| Finance, Financial Markets and Banking
|Awards and prizes:|
|Abstract:||This thesis investigates the effect of individual countries’ cultural characteristics
on macroeconomic stability. Macroeconomic stability is a general concept
that comprises the stable development of several economic parameters –
inflation, government budget, external debt, gross domestic product, and others.
The mainstream economics investigates these indicators usually as being
shaped only by wealth, political stability and institutions. However recently,
the economic literature reveals the relationship between some of the individual
cultural characteristics – mainly trust – and macroeconomic (in)stability.
This thesis is the first attempt to analyze the effect of complex set of cultural
characteristics on macroeconomic stability. Through the lens of panel data regression
it is shown that the macroeconomic stability is significantly affected
by cultural characteristics. In particular, more individualistic countries tend
to have lower macroeconomic stability. Furthermore, in countries where people
feel stronger fear about uncertainty the macroeconomic stability is also weaker.
On the contrary from the previous studies, the positive effect of higher trust
on macroeconomic stability is not confirmed.