Comparing normative institutionalism with intended rationality in cultural-finance research

This article presents a partial survey of the literature of the burgeoning area of cultural finance with a view of how respective investigations and results are explicitly or implicitly framed in relation to either normative institutionalism or intended rationality. Studies are examined by comparing national culture as influencing financial systems either by shaping the norms of behavior and concomitant logic of appropriateness, or, alternatively, shaping environments so as to impact the incentives for differing actors to maximize their utilities. For the cultural dimensions of the Hofstede framework, suggestions are made regarding deploying future studies within an intended rationality or normative institutionalism framework. This taxonomy also highlights the role of national culture with respect to transaction costs and agency costs, and is relevant to many cultural finance studies. The developing area of cultural finance can benefit from examining investigations, results, and discussions with regard to the contrasting perspectives of normative institutionalism and intended rationality.