How might em era cultures differ from prior era cultures? Today, we can identify many standard dimensions along which cultures around the world vary ( Hofstede et al. 2010 ; Gorodnichenko and Roland 2011 ; Minkov 2013 ). For some of these standard dimensions, the world has moved in a relatively consistent direction during the industrial era, and we have good reasons to expect this direction to be more productive in a modern economy. Because of this, we have good reasons to expect that a competitive em economy will continue to select for these cultural features. For example, we should expect more industriousness relative to indulgence, a work relative to a leisure orientation, time orientations that are long term relative to short term and that are tied to clocks instead of relationships, low instead of high context attitudes toward rules and communication, and a loose relative to tight attitude on interpreting social norms. For other standard cultural dimensions, productivity considerations don’t as clearly suggest which direction an em world favors. These dimensions include degree of avoidance of risk and uncertainty, tolerance of inequality, individual or group identity, cooperative or competitive emphasis, and high or low emotional expressiveness. Today, about 70% of the variation in values across nations is captured in just two key factors ( Inglehart and Welzel 2010 ). These two factors also capture much of the variation in individual values ( Schwartz et al. 2012 ). One factor varies primarily between rich and poor nations: increasing wealth seems to cause more individualism, universalism, egalitarianism, autonomy, and self-expression. These subfactors seem to be more a result than a cause of wealth. With increasing wealth, our values have moved away from conformity to traditional “conservative” farmer-like values, and toward more “liberal” forager-like values (Hanson 2010b; Hofstede et al. 2010). Poor nations tend more to value respecting parents and authority, believing in good and evil, and wanting to protect local jobs. Rich nations tend more to value trust and imagination, and acceptance of divorce and homosexuality.
Trade Effects Based on Trade Equilibrium
