Political Culture and Economic Outcomes

What kind of an impact does political culture have on political and economic outcomes and are there systematic differences across countries? In this new paper, Alberto Alesina and Paola Guiliano use data culled from the World Value Survey to demonstrate an effect between the strength of family ties (which they argue are different across cultures) and economic outcomes.

Here is the abstract and a link to the paper:

We study the importance of culture, as measured by the strenght of family ties, on economic ehavior and attitudes. We define our measure of family ties using individual responses from he World Value Survey regarding the role of the family and the love and respect that children eed to have for their parents for over 70 countries. We show that strong family ties imply more reliance on the family as an economic unit which provides goods and services and less on the market and on the government for social insurance. With strong family ties home production is higher, labor force participation of women and youngsters, and geographical mobility, lower. Families are larger (higher fertility and higher family size) with strong family ties, which is consistent with the idea of the family as an important economic unit. We present evidence in cross country regressions. To assess causality we look at the behavior of second generation immigrants in the US and we employ a variable based on the grammatical rule of pronoun drop as an instrument for family ties. Our results overall indicate a significant influence of the strength of family ties on economic outcomes.