Chapter 04 Differences in Culture Answer Key

True / False Questions

1. In today's world of global communications, rapid transportation, and global markets, cultural
differences have ceased to exist.

FALSE
In these days of global communications, rapid transportation, worldwide markets, and global
brands, when the era of the global village seems just around the corner, it is easy to forget just
how different various cultures really are. Underneath the veneer of modernism, deep cultural
differences often remain.

2. Culture is not static.

TRUE
Culture is not static. It can and does evolve, although the rate at which culture can change is the
subject of some dispute.

3. Norms are abstract ideas about what a group believes to be good, right, and desirable.

FALSE
Norms refer to the social rules and guidelines that prescribe appropriate behavior in particular
situations.

4. The term society is another name for a country; each country has a single society.

FALSE
The term society refers to a group of people who share a common set of values and norms. While
a society may be equivalent to a country, some countries harbor several societies (i.e., they
support multiple cultures), and some societies embrace more than one country.
5. A country is defined as a system of values and norms that are shared among a group of people
and that when taken together constitute a design for living.

FALSE
Culture is viewed as a system of values and norms that are shared among a group of people and
that when taken together constitute a design for living.

6. Folkways include rituals and symbolic behavior.

TRUE
Folkways include rituals and symbolic behavior. Rituals and symbols are the most visible
manifestations of a culture and constitute the outward expression of deeper values.

7. Upon meeting a foreign business executive, a Japanese executive will hold his business card in
both hands and bow while presenting the card to the foreigner. This is an example of ritual
behavior.

TRUE
Rituals and symbols are the most visible manifestations of a culture and constitute the outward
expression of deeper values. For example, upon meeting a foreign business executive, a Japanese
executive will hold his business card in both hands and bow while presenting the card to the
foreigner.

8. Folkways have much greater significance than mores.

FALSE
Mores are norms that are seen as central to the functioning of a society and to its social life. They
have much greater significance than folkways.
9. Even if a country can be characterized as having a single homogenous culture, often that national
culture is a mosaic of subcultures.

TRUE
The relationship between culture and country is often ambiguous. Even if a country can be
characterized as having a single homogenous culture, often that national culture is a mosaic of
subcultures.

10. The values and norms of a culture do not emerge fully formed.

TRUE
The values and norms of a culture do not emerge fully formed. They evolve over time in response
to a number of factors, including prevailing political and economic philosophies, the social
structure of a society, and the dominant religion, language, and education.

11. Individualism has led to a high degree of managerial mobility between companies resulting in
managers who have good general skills but lack company-specific experience.

TRUE
The lack of loyalty and commitment to an individual company, and the tendency to move on for a
better offer, can result in managers who have good general skills but lack the knowledge,
experience, and network of interpersonal contacts that come from years of working within the
same company.

12. The emphasis on the individual in the United States may raise the costs of doing business due to
its adverse impact on managerial stability and cooperation.

TRUE
An effective manager draws on company-specific experience, knowledge, and a network of
contacts to find solutions to current problems, and American companies may suffer if their
managers lack these attributes. The emphasis on individualism may also make it difficult to build
teams within an organization to perform collective tasks.
13. In countries where the value of group identification is considered to be primary, managers and
workers are discouraged from moving from company to company.

TRUE
The primacy of the value of group identification discourages managers and workers from moving
from company to company.

14. The term social strata refers to the extent to which individuals can move out of the strata into
which they were born.

FALSE
All societies are stratified on a hierarchical basis into social categories—that is, into social strata.
These strata are typically defined on the basis of characteristics such as family background,
occupation, and income.

15. The most rigid system of stratification is a class system.

FALSE
The most rigid system of stratification is a caste system. A class system is a less rigid form of social
stratification in which social mobility is possible.

16. A caste system is a closed system of stratification in which social position is determined by the
family into which the person is born.

TRUE
A caste system is a closed system of stratification in which social position is determined by the
family into which a person is born, and change in that position is usually not possible during an
individual's lifetime.
17. A class system is a rigid form of social stratification in which the position a person has by birth
cannot be changed through his/her own achievements or luck.

FALSE
A class system is a less rigid form of social stratification in which social mobility is possible. It is a
form of open stratification in which the position a person has by birth can be changed through his
or her own achievements or luck.

18. Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background.

TRUE
Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background, and this shapes their relationships with members of other classes.

19. An antagonistic relationship between management and labor classes may result in lower costs of
production.

FALSE
An antagonistic relationship between management and labor classes, and the resulting lack of
cooperation and high level of industrial disruption, tends to raise the costs of production in
countries characterized by significant class divisions.

20. Ethical systems may be defined as a system of shared beliefs and rituals that are concerned with
the realm of the sacred.

FALSE
Ethical systems refer to a set of moral principles, or values, that are used to guide and shape
behavior. Most of the world's ethical systems are the product of religions.
21. According to Max Weber, Protestantism encouraged capitalism's development by emphasizing
the importance of wealth creation and frugality.

TRUE
Weber argued that Protestant ethics emphasize the importance of hard work and wealth creation
(for the glory of God) and frugality (abstinence from worldly pleasures). According to Weber, this
kind of value system was needed to facilitate the development of capitalism.

22. Like Christianity and Judaism, Islam is a polytheistic religion.

FALSE
Like Christianity and Judaism, Islam is a monotheistic religion. The central principle of Islam is that
there is but the one true omnipotent God.

23. The Koran speaks disapprovingly of free enterprise.

FALSE
The Koran speaks approvingly of free enterprise and of earning legitimate profit through trade
and commerce (the prophet Mohammed himself was once a trader).

24. The protection of the right to private property is embedded within Islam.

TRUE
The protection of the right to private property is also embedded within Islam, although Islam
asserts that all property is a favor from Allah (God), who created and so owns everything. Those
who hold property are regarded as trustees rather than owners in the Western sense of the word.

25. The mudarabah contract is the most widely used Islamic banking method, because it is the easiest
to implement.

FALSE
The Islamic banking method, the murabaha contract, is the most widely used among the world's
Islamic banks, primarily because it is the easiest to implement.
26. Max Weber thought that devout Hindus would be less likely to engage in entrepreneurial activity
than devout Protestants.

TRUE
Max Weber argued that the ascetic principles embedded in Hinduism do not encourage the kind
of entrepreneurial activity in pursuit of wealth creation found in Protestantism. Given the emphasis
on an ascetic lifestyle, Weber thought that devout Hindus would be less likely to engage in
entrepreneurial activity than devout Protestants.

27. Unlike Hinduism, Buddhism supports the caste system.

FALSE
According to Buddhism, suffering originates in people's desires for pleasure. Cessation of
suffering can be achieved by following a path for transformation. Unlike Hinduism, Buddhism
does not support the caste system.

28. Both Hindus and Buddhists stress the afterlife and spiritual achievement rather than involvement
in this world.

TRUE
Like Hindus, Buddhists stress the afterlife and spiritual achievement rather than involvement in this
world.

29. Confucianism is a religion.

FALSE
For more than 2,000 years until the 1949 Communist revolution, Confucianism was the official
ethical system of China. Although not a religion, Confucian ideology has become deeply
embedded in the culture of these countries over the centuries, and through that, has an impact
on the lives of many millions more.
30. Guanxi is an important mechanism for building long-term business relationships and getting
business done in China.

TRUE
In a society that lacks a rule-based legal tradition, and thus legal ways of redressing wrongs such
as violations of business agreements, guanxi is an important mechanism for building long-term
business relationships and getting business done in China.

31. Since English is often thought of as the global language of business, it is not important for an
American business executive to learn foreign languages.

FALSE
Although English is widely used, learning the local language yields considerable advantages. Most
people prefer to converse in their own language, and being able to speak the local language can
build rapport, which may be very important for a business deal.

32. Unspoken language refers to nonverbal communication.

TRUE
Unspoken language refers to nonverbal communication.

33. Education plays an important role, from an international business perspective, as a determinant of
national competitive advantage.

TRUE
From an international business perspective, one important aspect of education is its role as a
determinant of national competitive advantage. The availability of a pool of skilled and educated
workers seems to be a major determinant of the likely economic success of a country.
34. Hofstede's study found that in masculine cultures, sex roles were less sharply distinguished, and
little differentiation was made between men and women in the same job.

FALSE
Hofstede's masculinity versus femininity dimension looked at the relationship between gender and
work roles. In masculine cultures, sex roles were sharply differentiated and traditional "masculine
values," such as achievement and the effective exercise of power, determined cultural ideals.

35. Hofstede's research has been criticized because it was culturally bound.

TRUE
Hofstede's research may have been culturally bound. The research team was composed of
Europeans and Americans. Hofstede's results confirm Western stereotypes, because it was
Westerners who undertook the research.

36. People who take food or safety for granted tend to be xenophobic, are wary of political activity,
have authoritarian tendencies, and believe that men make better political leaders than women.

FALSE
According to the the World Values Survey, "survival values" are the values people hold when the
struggle for survival is of paramount importance. People who cannot take food or safety for
granted tend to be xenophobic, are wary of political activity, have authoritarian tendencies, and
believe that men make better political leaders than women.

37. The convergence hypothesis states that there is a slow but steady merging occurring across
different cultures towards some universally accepted values and norms.

TRUE
With regard to globalization, some have argued that advances in transportation and
communication technologies are helping to create conditions for the merging or convergence of
cultures. There may be, in other words, a slow but steady convergence occurring across different
cultures towards some universally accepted values and norms: This is known as the convergence
hypothesis.
38. International businesses that are ill-informed about the practices of another culture are likely to
fail.

TRUE
International businesses that are ill-informed about the practices of another culture are likely to
fail. Doing business in different cultures requires adaptation to conform with the value systems
and norms of that culture.

39. The value systems and norms of a country are unrelated to the costs of doing business in that
country.

FALSE
The value systems and norms of a country influence the costs of doing business in that country.
The costs of doing business in a country influence the ability of firms to establish a competitive
advantage in the global marketplace.

40. The connection between culture and competitive advantage has important implications for the
choice of countries in which to locate production facilities and do business.

TRUE
The connection between culture and competitive advantage has important implications for the
choice of countries in which to locate production facilities and do business.

Multiple Choice Questions

41. Which of the following is NOT true regarding culture?

A. Culture is static.
B. Culture varies across and within nations.
C. Culture is a system of values and norms that are shared among a group of people.
D. Culture involves the knowledge and beliefs of people.
Culture is not static. It can and does evolve, although the rate at which culture can change is the
subject of some dispute.

42. Cross-cultural literacy refers to:

A. an individual's self-concept derived from perceived membership in a relevant social group.

B. the phenomenon of merging and converging cultures.
C. abstract ideas about what a group believes to be good, right, and desirable.
D. an understanding of how cultural differences can affect business.
Cross-cultural literacy refers to an understanding of how cultural differences across and within
nations can affect the way business is practiced.

43. _____ is/are best defined as shared assumptions about how things ought to be.

A. Norms
B. Values
C. Society
D. Culture
Values refer to abstract ideas about what a group believes to be good, right, and desirable. Put
differently, values are shared assumptions about how things ought to be.
44. The system of values and norms that are shared among a group of people and that when taken
together constitute a design for living best defines:

A. society.
B. value systems.
C. principles.
D. culture.
Culture is a system of values and norms that are shared among a group of people and that when
taken together constitute a design for living.

45. Social rules and guidelines that prescribe appropriate behavior in particular situations are best
described as:

A. norms.
B. values.
C. culture.
D. society.
Norms refer to the social rules and guidelines that prescribe appropriate behavior in particular
situations.

46. Norms refer to:

A. the social rules and guidelines that prescribe appropriate behavior in particular situations.
B. a system of values that are shared among a group of people.
C. the routine conventions of everyday life.
D. abstract ideas about what a group believes to be good, right, and desirable.
Norms refer to the social rules and guidelines that prescribe appropriate behavior in particular
situations.
47. A group of people who share a common set of values and norms form a:

A. culture.
B. society.
C. country.
D. caste.
Society refers to a group of people who share a common set of values and norms.

48. _____ are the routine conventions of everyday life.

A. Folkways
B. Mores
C. Rites
D. Beliefs
Folkways are the routine conventions of everyday life. They are social conventions concerning
things such as the appropriate dress code in a particular situation, good social manners, eating
with the correct utensils, neighborly behavior, and the like.

49. _____ are social conventions concerning things such as the appropriate dress code in a particular
situation, good social manners, eating with the correct utensils, neighborly behavior, and the like.

A. Values
B. Beliefs
C. Mores
D. Folkways
Folkways are the routine conventions of everyday life. They are social conventions concerning
things such as the appropriate dress code in a particular situation, good social manners, eating
with the correct utensils, neighborly behavior, and the like.
50. An act, as simple as shaking hands when meeting new people is an example of:

A. values.
B. symbolic behavior.
C. mores.
D. social stratification.
Folkways include rituals and symbolic behavior. Rituals and symbols are the most visible
manifestations of a culture and constitute the outward expression of deeper values.

51. A Japanese executive's ritual of presenting a business card to a foreign business executive is an
example of:

A. mores.
B. values.
C. attitudes.
D. folkways.
Folkways are the routine conventions of everyday life. Folkways include rituals and symbolic
behavior. For example, upon meeting a foreign business executive, a Japanese executive will hold
his business card in both hands and bow while presenting the card to the foreigner.

52. Mores are:

A. the norms that are seen as central to the functioning of a society and its social life.
B. the routine conventions of everyday life.
C. abstract ideas about what a group believes to be right, good, and desirable.
D. the social rules and guidelines that prescribe appropriate behavior in particular situations.
Mores are norms that are seen as central to the functioning of a society and to its social life.
Accordingly, violating mores can bring serious retribution.
53. Which of the following statements about mores is true?

A. Mores are the routine conventions of daily life.

B. Mores are actions of little moral significance.
C. In many societies, certain mores have been enacted into law.
D. People who violate mores may be thought of as ill-mannered, but they are not considered to
be evil.
Mores include such factors as indictments against theft, adultery, incest, and cannibalism. In many
societies, certain mores have been enacted into law.

54. Which of the following statements about values and norms of a culture is NOT true?

A. The values and norms of a society do not emerge fully formed.

B. The values and norms of a society are the evolutionary product of a number of factors.
C. The values and norms of a society are influenced by religion.
D. The values and norms of a society do not influence social structure.
While factors such as social structure and religion clearly influence the values and norms of a
society, the values and norms of a society can influence social structure and religion.

55. A society's social structure refers to its:

A. system of values and norms.

B. basic social organization.
C. religious practices.
D. educational infrastructure.
A society's social structure refers to its basic social organization.
56. The social organization of Western society tends to emphasize on:

A. a group orientation.
B. collectivist values.
C. individual achievement.
D. work groups.
In general, Western societies tend to emphasize the primacy of the individual, whereas groups
tend to figure much larger in many other societies.

57. The emphasis on individualism in the United States results in all of the following disadvantages
EXCEPT:

A. managers tend to develop good general skills but lack the company-specific experience.
B. difficulty in building teams within an organization to perform collective tasks.
C. executives are not exposed to different ways of doing business.
D. difficulty to achieve cooperation both within a company and between companies.
One positive aspect of high managerial mobility is that executives are exposed to different ways of
doing business.

58. Which of the following is a consequence of the emphasis on individual performance in many
Western societies?

A. Decreased entrepreneurship
B. High degree of managerial mobility
C. Increased loyalty towards an individual company
D. Executives are not exposed to different ways of doing business
The emphasis on individual performance in many Western societies has both beneficial and
harmful aspects. Individualism finds expression in a high degree of managerial mobility between
companies, and this is not always a good thing.
59. Which of the following refers to the extent to which individuals can move out of the strata into
which they are born?

A. Caste stratification
B. Class system
C. Social mobility
D. Individual potential
The term social mobility refers to the extent to which individuals can move out of the strata into
which they are born. Social mobility varies significantly from society to society. The most rigid
system of stratification is a caste system.

60. Which of the following is a closed system of stratification in which social position is determined by
the family into which a person is born, and change in that position is usually not possible during
an individual's lifetime?

A. Caste system
B. Class system
C. Social system
D. Cultural system
A caste system is a closed system of stratification in which social position is determined by the
family into which a person is born, and change in that position is usually not possible during an
individual's lifetime.

61. A _____ is a less rigid form of social stratification in which social mobility is possible.

A. caste system
B. normative system
C. religious system
D. class system
A class system is a less rigid form of social stratification in which social mobility is possible.
62. Which of the following statements is true about a class system?

A. A class system is a more rigid form of social stratification, compared to a caste system.
B. A class system is a closed form of stratification.
C. Social mobility within a class system varies from society to society.
D. In a class system, social position is determined at birth and cannot be changed during an
individual's lifetime.
A class system is a less rigid form of social stratification in which social mobility is possible. While
many societies have class systems, social mobility within a class system varies from society to
society.

63. A caste system differs from a class system because:

A. a caste system is an open system of stratification, while a class system is a closed system of
stratification.
B. it is not possible for an individual to change his or her caste, while a class system allows people
to change their class through individual achievement.
C. the social mobility in caste systems varies from society to society, while in a class system there
is no social mobility.
D. a caste system is a less rigid form of social stratification, while a class system is a comparatively
more rigid form of social stratification.
A caste system is a closed system of stratification in which social position is determined by the
family into which a person is born, and change in that position is usually not possible during an
individual's lifetime. A class system is a form of open stratification in which the position a person
has by birth can be changed through his or her own achievements or luck.
64. A condition where people tend to perceive themselves in terms of their class background and this
shapes their relationships with members of other classes is known as:

A. class stratification.
B. social mobility.
C. class mobility.
D. class consciousness.
Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background, and this shapes their relationships with members of other classes.

65. An upper-middle-class manager tends to have hostile relationship with the working-class
employees in the firm because of his tendency to perceive himself as superior to them based on
his class background. In this example, the manager exhibits:

A. class consciousness.
B. cultural awareness.
C. social mobility.
D. group orientation.
Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background, and this shapes their relationships with members of other classes.

66. Ethical systems are:

A. a set of moral principles, or values, that are used to guide and shape behavior.
B. shared beliefs and rituals that are concerned with the realm of the sacred.
C. routine conventions of everyday life.
D. social rules that govern people's actions toward each other.
Ethical systems refer to a set of moral principles, or values, that are used to guide and shape
behavior.
67. Religion may be defined as:

A. routine conventions of everyday life.

B. social rules that govern people's actions toward each other.
C. shared beliefs and rituals that are concerned with the realm of the sacred.
D. a set of moral principles, or values, that are used to guide and shape behavior.
Religion may be defined as a system of shared beliefs and rituals that are concerned with the
realm of the sacred.

68. Max Weber theorized that there was a relationship between Protestantism and the emergence of
modern capitalism because:

A. Protestant ethics emphasize the importance of hard work and wealth creation and frugality.
B. Protestantism promotes the hierarchical domination of religious and social life.
C. Protestantism states that spiritual growth is more important than material wealth.
D. Protestantism promotes blind loyalty to employers.
Weber argued that Protestant ethics emphasize the importance of hard work and wealth creation
(for the glory of God) and frugality (abstinence from worldly pleasures). According to Weber, this
kind of value system was needed to facilitate the development of capitalism.

69. Which of the following sociologists made a connection between Protestant ethics and "the spirit
of capitalism"?

A. Karl Marx
B. Max Weber
C. Amartya Sen
D. Adam Smith
In 1904, a German sociologist, Max Weber, made a connection between Protestant ethics and "the
spirit of capitalism" that has since become famous. Weber theorized that there was a relationship
between Protestantism and the emergence of modern capitalism.
70. According to Islam, those who hold property are regarded as:

A. Trustees.
B. owners.
C. tenants.
D. speculators.
The protection of the right to private property is also embedded within Islam, although Islam
asserts that all property is a favor from Allah (God), who created and so owns everything. Those
who hold property are regarded as trustees rather than owners in the Western sense of the word.

71. Which of the following observations is correct?

A. The economic principles established in the Koran are against free enterprise.
B. The economic principles of Islam prohibit the payment or receipt of interest.
C. The Koran speaks disapprovingly of earning legitimate profit through trade and commerce.
D. Protection of the right to private property is not embedded within Islam.
One economic principle of Islam prohibits the payment or receipt of interest, which is considered
usury. This is not just a matter of theology; in several Islamic states, it is also a matter of law.

72. Under the mudarabah banking system, when an Islamic bank lends money to a business:

A. it charges that business interest on the loan.

B. the business needs to pay back the loan with an additional markup.
C. it has to donate the interest received on the loan to a charitable trust.
D. it takes a share in the profits that are derived from the investment.
A mudarabah contract is similar to a profit-sharing scheme. Under mudarabah, when an Islamic
bank lends money to a business, rather than charging that business interest on the loan, it takes a
share in the profits that are derived from the investment.
73. Which of the following statements is true about the murabaha contract?

A. Under the murabaha contract, when an Islamic bank lends money to a business it takes a share
in the profits that are derived from the investment.
B. Under the murabaha contract, money deposited in a savings account is treated as an equity
investment in whatever activity the bank uses the capital for.
C. The murabaha contract is widely used among the world's Islamic banks because it is the easiest
to implement.
D. The murabaha contract is a more efficient system than the Western banking system since it
encourages both long-term savings and long-term investment.
The Islamic banking method, the murabaha contract, is the most widely used among the world's
Islamic banks, primarily because it is the easiest to implement.

74. Hindus believe:

A. that there is but the one true omnipotent God.

B. in reincarnation, or rebirth into a different body, after death.
C. in the importance of individual religious freedom.
D. that material quest is more important than spiritual quest.
Hindus believe in reincarnation, or rebirth into a different body, after death. Hindus also believe in
karma, the spiritual progression of each person's soul.

75. A major difference between Buddhism and Hinduism is that unlike Hinduism, Buddhism:

A. does not support the cast system.

B. emphasizes wealth creation.
C. promotes blind loyalty to employers.
D. supports extreme ascetic behavior.
Unlike Hinduism, Buddhism does not support the caste system. Nor does Buddhism advocate the
kind of extreme ascetic behavior that is encouraged by Hinduism.
76. Three values central to the Confucian system of ethics have very important economic implications.
Which of the following is NOT one among them?

A. Loyalty
B. Rule-based law
C. Reciprocal obligations
D. Honesty in dealings with others
The influence of Confucian ethics on the culture of China, Japan, South Korea, and Taiwan, by
lowering the costs of doing business in those countries, may help explain their economic success.
In this regard, three values central to the Confucian system of ethics are of particular interest:
loyalty, reciprocal obligations, and honesty in dealings with others.

77. Which of the following statements about the use of spoken language is NOT true?

A. The nature of a language structures the way we perceive the world.

B. The language of a society can direct the attention of its members to certain features of the
world rather than others.
C. Countries with more than one language often have more than one culture.
D. Most people prefer to converse in English rather than their own language.
Most people prefer to converse in their own language, and being able to speak the local
language can build rapport, which may be very important for a business deal.

78. The _____ dimension of Hofstede's study explores how a society deals with the fact that people are
unequal in physical and intellectual capabilities.

A. power distance
B. individualism versus collectivism
C. uncertainty avoidance
D. masculinity versus femininity
Hofstede's power distance dimension focused on how a society deals with the fact that people are
unequal in physical and intellectual capabilities.
79. The individualism versus collectivism dimension of Hofstede's study explored:

A. the extent to which different cultures socialized their members into accepting ambiguous
situations and tolerating uncertainty.
B. the relationship between gender and work roles.
C. how a society deals with the fact that people are unequal in physical and intellectual
capabilities.
D. the relationship between the individual and his/her fellows.
The individualism versus collectivism dimension focused on the relationship between the
individual and his or her fellows.

80. Hofstede's uncertainty avoidance dimension considered:

A. the extent to which different cultures socialized their members into accepting ambiguous
situations and tolerating uncertainty.
B. the relationship between gender and work roles.
C. how a society deals with the fact that people are unequal in physical and intellectual
capabilities.
D. the relationship between the individual and his or her fellows.
Hofstede's uncertainty avoidance dimension measured the extent to which different cultures
socialized their members into accepting ambiguous situations and tolerating uncertainty.
81. According to Geert Hofstede's study, which of the following cultural dimensions would be
characterized by a greater readiness to take risks and less emotional resistance to change?

A. High power distance cultures

B. Low uncertainty avoidance
C. High collectivism
D. Low power distance cultures
Hofstede's uncertainty avoidance dimension measured the extent to which different cultures
socialized their members into accepting ambiguous situations and tolerating uncertainty. Lower
uncertainty avoidance cultures were characterized by a greater readiness to take risks and less
emotional resistance to change.

82. Hofstede's dimension of Confucian dynamism:

A. captures attitudes toward time, persistence, ordering by status, protection of face, respect for
tradition, and reciprocation of gifts and favors.
B. focuses on how a society deals with the fact that people are unequal in physical and intellectual
capabilities.
C. explores the relationship between the individual and his/her fellows.
D. looks at the relationship between gender and the ability to accept ambiguous situations.
According to Hofstede, Confucian dynamism captures attitudes toward time, persistence, ordering
by status, protection of face, respect for tradition, and reciprocation of gifts and favors.
83. Which of the following is an example of ethnocentrism?

A. A manager in India looks down upon his subordinates because they are from a lower caste,
compared to him.
B. An upper-middle-class woman talks rudely to a sales person, because she looks down upon
individuals belonging to the working-class.
C. An American manager criticizes the cultural practices of Saudi Arabia, when he is sent there on
business, because it differs from his own cultural norms.
D. A French business owner, who plans to expand his market to China, conducts a detailed
cultural study of China to customize his marketing campaign.
Ethnocentrism is a belief in the superiority of one's own ethnic group or culture. Hand in hand
with ethnocentrism goes a disregard or contempt for the culture of other countries.

Essay Questions

84. Compare and contrast folkways and mores.

Folkways are the routine conventions of everyday life. Generally, folkways are actions of little
moral significance. Folkways include rituals and symbolic behavior. In contrast, mores are norms
that are seen as central to the functioning of a society and to its social life. Mores have much
greater significance than folkways. Accordingly, violating mores can bring serious retribution.
85. Discuss the relationship between society and the nation-state.

A society is a group of people that share a common set of values and norms, that is, people who
are bound together by a common culture. There is not a strict one-to-one correspondence
between a society and a nation-state. Nation-states are political creations that may contain a
single culture or several cultures. While it is possible to talk about cultures at different levels, for
example, an "American society," and "American culture," it is important to recognize there are
several societies within America, each with its own culture. The relationship between culture and
country is often ambiguous. Even if a country can be characterized as having a single
homogenous culture, often that national culture is a mosaic of subcultures.

86. What are the determinants of culture?

The values and norms of a culture do not emerge fully formed. They are the evolutionary product
of political philosophy, economic philosophy, education, language, social structure, and religion.
The chain of causation runs both ways. While factors such as social structure and religion clearly
influence the values and norms of a society, the values and norms of a society can influence social
structure and religion.

87. Explain the concept of social stratification.

All societies are stratified on a hierarchical basis into social categories or social strata. Social strata
are typically defined on the basis of characteristics such as family background, occupation, and
income. Individuals born into the top of a social hierarchy tend to have better life chances than
individuals born into a lower stratum. While all societies are stratified to some degree they differ
from each other with regard to the degree of mobility between social strata and with regard to
the significance attached to social strata in business contexts.
88. Discuss why the stratification of a society is important to business.

The stratification of a society is significant if it affects the operation of business organizations. In a

country like Great Britain for example, the relative lack of class mobility and the differences
between classes has resulted in hostility between middle-class managers and their working-class
employees. An antagonistic relationship between management and labor classes, and the
resulting lack of cooperation and high level of industrial disruption, tends to raise the costs of
production in countries characterized by significant class divisions. In turn, this can make it more
difficult for companies based in such countries to establish a competitive advantage in the global
economy.

89. What is the connection between religion and ethical systems? Do they have any implications for
business?

Ethical systems are a set of moral principles, or values, that are used to guide and shape behavior.
Most of the world's ethical systems are the product of religions. Therefore, there are Christian
ethics and Islamic ethics. There are four dominant religions in the world: Christianity, Islam,
Hinduism, and Buddhism. The relationship among religion, ethics, and society is subtle and
complex. Some scholars have argued that the most important business implications of religion
center on the extent to which different religions shape attitudes toward work and
entrepreneurship and the degree to which the religious ethics affect the costs of doing business in
a country.
The authors point out that it is hazardous to make sweeping generalizations about the nature of
the relationship between religion and ethical systems and business practice. The proposed
relationships may exist, but their impact may be small compared to the impact of economic
policy.
90. Discuss the ideas of Max Weber. What is the Protestant work ethic? Why is it important to the
world economy?

Max Weber was a German sociologist who, in 1904, made the connection between Protestant
ethics and "the spirit of capitalism." According to Weber, there was a relationship between
Protestantism and the emergence of modern capitalism. Weber suggested that the Protestant
value system that emphasized the importance of hard work, wealth creation, and frugality was
needed to facilitate the development of capitalism.
Thus, Weber coined the term "Protestant work ethic" to denote the tendency on the part of
Protestants to work hard and accumulate wealth, which are the underpinnings of capitalism.

91. Explain how the Koran views business.

The Koran establishes some explicit economic principles, many of which are pro-free enterprise.
The Koran supports free enterprise and earning a legitimate profit through trade and commerce,
as well as the protection of the right to private property. However, Islam is critical of those who
earn profit through the exploitation of others. Islam stresses the importance of living up to
contractual obligations, of keeping one's word, and of abstaining from deception. One economic
principle of Islam prohibits the payment or receipt of interest, which is considered usury. This is
not just a matter of theology; in several Islamic states, it is also a matter of law.

92. What are the economic implications of the caste system supported by Hinduism?

Historically, Hinduism supported India's caste system. The concept of mobility between castes
within an individual's lifetime makes no sense to traditional Hindus. Hindus see mobility between
castes as something that is achieved through spiritual progression and reincarnation. Insofar as
the caste system limits individuals' opportunities to adopt positions of responsibility and influence
in society, the economic consequences of this religious belief are somewhat negative. For
example, within a business organization, the most able individuals may find their route to the
higher levels of the organization blocked simply because they come from a lower caste. By the
same token, individuals may get promoted to higher positions within a firm as much because of
their caste background as because of their ability.
93. What is Buddhism? Compare Buddhism with Hinduism.

Buddhism was founded in India in the sixth century BC by Siddhartha Gautama, an Indian prince
who renounced his wealth to pursue an ascetic lifestyle and spiritual perfection.
According to Buddhism, suffering originates in people's desires for pleasure. Cessation of
suffering can be achieved by following a path for transformation. Siddhartha offered the Noble
Eightfold Path as a route for transformation. This emphasizes right seeing, thinking, speech,
action, living, effort, mindfulness, and meditation. Unlike Hinduism, Buddhism does not support
the caste system. Nor does Buddhism advocate the kind of extreme ascetic behavior that is
encouraged by Hinduism. Nevertheless, like Hindus, Buddhists stress the afterlife and spiritual
achievement rather than involvement in this world.

94. Consider the influence of Confucian ethics on the economies of China, Japan, South Korea, and
Taiwan.

It has been suggested that the economic success of China, Japan, South Korea, and Taiwan, may
be due, in part, to the influence of Confucian ethics on the culture in those countries. Three values
that are central to the Confucian system of ethics are of particular note: loyalty, reciprocal
obligations, and honesty in dealing with others. The concept of reciprocal obligations is important.
Confucian ethics stress that superiors are obliged to reward the loyalty of their subordinates by
bestowing blessings on them. The notion of guanxi, or business relationships, which permeates
business dealings in the region, revolves around the three values. For example, it has been
suggested that the close ties between the automobile companies and their suppliers in Japan are
facilitated by a combination of trust and reciprocal obligations.
95. Discuss the spoken language. Which is the most spoken language in the world? What language is
used in business? Is it important to learn a foreign language?

Language does far more than just enable people to communicate with each other. The nature of
a language also structures the way we perceive the world. Because language shapes the way
people perceive the world, it also helps define culture. Chinese is the mother tongue of the largest
number of people in the world, followed by English and Hindi. However, the most widely spoken
language in the world is English, followed by French, Spanish and Chinese. English is increasingly
known as the language of international business. Therefore, even when a business meeting does
not involve native English speakers, English is likely to be spoken. Learning a foreign language is
still very important for native English speakers because doing so can build rapport, and help a
company avoid costly translation blunders.

96. Consider the importance of unspoken language. Why is it important to be familiar with the
unspoken language of another culture?

Unspoken language refers to nonverbal communication. We all communicate with each other by
a host of nonverbal cues. The raising of eyebrows, for example, is a sign of recognition in most
cultures, while a smile is a sign of joy. Many nonverbal cues, however, are culturally bound. A
failure to understand the nonverbal cues of another culture can lead to a failure to communicate.
For example, making a circle with the thumb and forefinger is a friendly gesture in the United
States, but it is a vulgar gesture in Greece and Turkey.
Personal space is another part of unspoken language.
97. Why is the role of education in a culture important to international companies?

A key aspect of education in a culture is its role as a determinant of national competitive

advantage. The availability of a pool of skilled and educated workers seems to be a major
determinant of the likely economic success of a country. Porter for example, has argued that
Japan's excellent education system is an important factor explaining the country's postwar
economic success. In addition, a good education system is an important factor guiding the
location choices of international businesses. The general education level of a country is also a
good index of the kind of products that might sell in a country and of the type of promotional
material that should be used.

98. Describe the four dimensions of culture as identified by Geert Hofstede.

Geert Hofstede identified four dimensions that he claimed summarized the differences between
different cultures. According to Hofstede, the power distance dimension focused on how a society
deals with the fact that people are unequal in physical and intellectual capabilities. The second
dimension identified by Hofstede, individualism versus collectivism, focused on the relationship
between the individual and his/her fellows. Hofstede's third dimension, uncertainty avoidance,
measured the extent to which different cultures socialize their members into accepting ambiguous
situations and tolerating uncertainty. Finally, Hofstede's fourth dimension, masculinity versus
femininity, examined the relationship between gender and work roles.

99. Discuss the limitations of Hofstede's research.

Hofstede's research has been criticized on a number of points. First, Hofstede assumes there is a
one-to-one correspondence between culture and the nation-state. Second, the research may
have been culturally bound. Third, Hofstede's informants worked not only within a single industry,
but within one company. Finally, because cultures evolve, Hofstede's research, which was
conducted in the 1960s and 1970s, may not be as relevant today.
100. Discuss Confucian dynamism. Explore the debate over whether Confucian dynamism is good for
an economy.

The notion of Confucian dynamism, or long-term orientation, was added to Hofstede's model of
culture to capture attitudes toward time, persistence, ordering by status, protection of face,
respect for tradition, and reciprocation of gifts and favors. East Asian countries such as Japan,
Hong Kong, and Thailand scored high on Confucian dynamism, while countries such as the United
States and Canada scored low. Hofstede hypothesized that being Confucian was good for
economic growth. However, other experts have questioned this hypothesis, noting that countries
that score low on Confucian dynamism have also achieved high growth rates.

101. Economic advancement and globalization are prompting societal change. Discuss this statement.

Several studies have shown that economic advancement and globalization are important factors
in societal change. The culture of societies may also change as they become richer because
economic progress affects a number of other factors, which in turn influence culture. A study of
values known as the World Values Survey has documented how values change.
According to this research, as countries get richer, there seems to be a shift from "traditional" to
"secular rational" values, and from "survival values" to "well-being" values.
There may be a slow but steady convergence occurring across different cultures towards some
universally accepted values and norms: This is known as the convergence hypothesis.

102. What are the implications of cultural differences for international businesses?

International business is different from national business because countries and

societies are different. Societies differ because their cultures vary. Three important implications for
international business flow from these differences. The first is the need to develop cross-cultural
literacy. There is a need not only to appreciate that cultural differences exist but also to appreciate
what such differences mean for international business. A second implication centers on the
connection between culture and national competitive advantage. A third implication looks at the
connection between culture and ethics in decision making.
103. Discuss the relationship between culture and national competitive advantage?

The value systems and norms of a country influence the costs of doing business in that country.
The costs of doing business in a country influence the ability of firms to establish a competitive
advantage in the global marketplace. It can be argued that the class-based conflict between
workers and management in class-conscious societies, when it leads to industrial disruption, raises
the costs of doing business in that society. Some sociologists have argued that the ascetic
"otherworldly" ethics of Hinduism may not be as supportive of capitalism as the ethics embedded
in Protestantism and Confucianism. Japan's emphasis on group affiliation, loyalty, reciprocal
obligations, honesty, and education, all boost the competitiveness of Japanese companies. But as
important as culture is, it is probably less important than economic, political, and legal systems in
explaining differential economic growth between nations.