A survey of culture and finance

Recent reviews on culture-research in International Business have stressed some of the merits of past culture-research centered on cross-national surveys while suggesting a potential for new approaches. At the same time, in financial research, a strong and significant interest for Culture studies is rising. We conduct here a survey of the financial literature, based on a systematic procedure to account for all existing efforts in relation to Culture and finance. Doing so, we note an overwhelming diversity of approaches in the way culture is conceptualized and operationalized, with little converging or consistent results to date. While it seems that current efforts centered on country-based indices (such as those derived from- or akin- to Hofstede's seminal contributions) seem to hardly find their way into main-stream peer-reviewed financial journals, other options are not yet coming through. Why? We underline the importance of disciplinary inbreeding in the way culture is operationalized in financial research today; the current methodological toolkit, embedded in the neoclassical paradigm (Brennan, 1995), may be insufficient to deal effectively with culture processes. Further venues may need to adapt the mainstream methodological toolkit accordingly. As a result, we suggest implementing backward definitions of culture with reliance on groups' characteristics and conceptualization of culture-finance mechanisms rather than departing from "what culture is" (or should be). Overall, it may be no coincidence if a culture interest is rising at a time Zingales (2000) calls for a re-foundation in Finance.