Culture and Economics

Abstract

Culture is often treated as the decoration on the economy, something that is of no consequence for the economy. This chapter takes a contrary line. Through tales and accounts of real-life encounters, the chapter illustrates the important role that culture and social institutions play in the functioning of an economy, at times paving the way for development prosperity, at times blocking growth and economic progress. Trust and trustworthiness are often as important as having a robust legal system for contract enforcement. They can make or break an economy.