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The Hofstede’s model has proposed five different criteria for describing national cultures. Those criteria are called dimensions and they are largely independent of each other. The cultural dimensions are:
•    Individualism versus collectivism
•    Power distance
•    Uncertainty avoidance
•    Masculinity versus femininity
•    Long or short term orientation
The model provided scales from 0 to 100 involving 76 countries for each dimension. Each country has a position on each scale relative to other countries. Originally, the country scores were produced in the early 1970s, however, many studies employing Hofstede’s model have proven that the country ranking in the data is still valid.
Individualism versus collectivism dimension refers to the extent to which individuals care only about themselves and immediate family. In cultures with strong individualism, one’s identity lies in the person individually where self-actualization is important and the people are more “I”-conscious. In individualistic culture, people are also universalistic, as explained by Mooij and Hofstede because the people from the culture assume that their values are valid for the whole world. Hofstede also reported that individualistic societies are described by weak relations between individuals. They practice explicit verbal communication because they are also low-context communication culture. On the other hand, collectivism refers to the extent to which people have a sense of belongingness to their group, organization or society. In the group, members look after each other in exchange for loyalty. In this culture, people are ‘we’-conscious. They identify themselves by the social system to which they belong where avoiding loss of face is important. Collectivistic cultures are high-context in communication and they practice indirect style of communication.
In individualistic cultures, parties involved in sales and negotiations usually want to get to the point as quickly as possible. In contrast, for individuals from collectivistic cultures, it is important to build a relationship and trust between parties before getting to the point. Therefore, a high score of individualism is ideal to facilitate entrepreneurial development. As suggested by Hayton et al., high individualism culture is one of the important entrepreneurial behaviors that indicate independent thinking. In entrepreneurship there are innovation initiation and innovation implementation. However, according to Williams and McQuire, compared to innovation implementation, innovation initiation is usually seen as an individual act where the individual initiates ideas and group can only be supportive or not. In addition, there is more value of freedom in individualistic cultures.
The second dimension, power distance, as defined by Hofstede (n.d) is the level of acceptance and expectation of less powerful members in organizations and institutions concerning the power that is distributed unequally. The high rank of power distance indicates the high level of power and wealth inequality within the society. Countries with high level of power distance practice authoritative structure of vertical hierarchies. In this society, decision making is centralized with the lower level individuals paying more respect for authority and even fearing the boss. This would result in the large gaps in compensation, respect and authority. payday loans reviews

This post was written by , posted on April 22, 2014 Tuesday at 11:31 am