Cross-Cultural Dimensions and Financial Efficiency: An Investigation at Macro Level

Based on the four cultural dimensions summarized by Hofstede's research team, this paper divides financial efficiency into direct financial efficiency and indirect financial efficiency, so as to study the influence of culture on financial efficiency and the relationship between the two. This paper finds that the correlation between different cultural dimensions and financial efficiency is significantly different. The correlation test proves that only power distance and individualism are significantly correlated with financial efficiency. Regression analysis supports that only individualism is significantly related with financial efficiency after adding three control variables, in which individualism index is negative with indirect financial efficiency, and positive with direct financial efficiency. In addition, the correlation between individualism and financial efficiency varies depending on whether the country is a developed