August 2015

IZA DP No. 9246: Culture and Institutions

published in: Journal of Economic Literature, 2015, 53 (4). 898-944

A growing body of empirical work measuring different types of cultural traits has shown that culture matters for a variety of economic outcomes. This paper focuses on one specific aspect of the relevance of culture: its relationship to institutions. We review work with a theoretical, empirical, and historical bent to assess the presence of a two-way causal effect between culture and institutions.