The effect of culture on innovation initiation and innovation implementation, a comparative study using Hofstede’s cultural dimensions and the Global Innovation Index.

Abstract

This thesis aims to investigate whether Hofstede’s cultural dimensions are differently related to innovation initiation than to innovation implementation. Both are operationalized through the Global Innovation Index. As innovation is a key determinant of economic growth, it is important to understand its determinants. The sample used in this study is cross-sectional and comprises of 60 countries. Regression analysis is performed on both innovation initiation and innovation implementation. Overall, the results show that power distance, individualism and uncertainty avoidance are differently related to innovation initiation than to innovation implementation. Innovation initiation is related to lower levels of power distance and a high level of individualism and long-term orientation. Innovation implementation is related to above average levels of individualism, a lower level of uncertainty avoidance and a high level of long-term orientation. This study is exploratory and provides insight in the relationship between Hofstede’s cultural dimensions and innovation implementation. Practitioners in the field of innovation should consider the effect of culture on both phases of the innovation process, initiation and implementation. However, future research would benefit from structural equation modelling, a larger sample and better control variables.