Is a Greek, in Germany, more productive?

Why don’t Australians fill up elevators even when there is long queue?  The elevator will be labelled for a maximum capacity of 22 people, but once eight people go in, no one else will (except me of course).

I had an interesting experience my first time skiing in Austria.  I was being very Aussie and politely letting people fill the gondola in front of me.  I wasn’t pushing, and when the gondola looked full I waited for the next one.  Unfrotunately, I didn’t get on until my Austrian friends dragged me in with them.  My best endeavours at conforming to the cultural norms of my home country were completely inappropriate under the circumstance.

This has led me to wonder, how powerful are cultural norms in determining economic and social outcomes?  Economists are gradually realising that cultural norms are often far more powerful incentives than prices.  This thought experiment usually helps provoke the idea a little better.

Begin by imagining what you know about German and Greek culture.  Now imagine that the German people are all relocated to Greece, and the Greeks relocated to Germany.  All the institutions and laws remain the same in each country, as does all the capital (buildings, machinery, vehicles), and all the business relationships.  The former German engineer is now an engineer in Greece, the former farmer in Greece is now farming in Germany, while the public servants also swap to hold public service roles in each country.

The question is, would Greece, now populated with the former Germans who have brought with them their cultural norms and behaviour, by a much more productive economy?  Would the new Germany, populated with the Greeks, lose its productive edge over time?

I don’t have an answer I can justify with any particular evidence – simply a gut feeling that German culture is more aligned with measureable economic outcomes than Greek culture.

Another example of divergent cultural norms is the social behaviour surrounding alcohol consumption.  Why is it that some countries have major problems with alcohol-fuelled violence and binge drinking, while others do not?  Many countries are trying to tax their way out of this problem, along with other social ‘sins’ including obesity and smoking.

I found this article had a unique take on the cultural side of binge drinking:

If I were given total power, I could very easily engineer a nation in which coffee would become a huge social problem – a nation in which young people would binge-drink coffee every Friday and Saturday night and then rampage around town centres being anti-social, getting into fights and having unprotected sex in random one-night stands.

I would restrict access to coffee, thus immediately giving it highly desirable forbidden-fruit status. Then I would issue lots of dire warnings about the dangerously disinhibiting effects of coffee.

I would make sure everyone knew that even a mere three cups (six “units”) of coffee “can lead to anti-social, aggressive and violent behaviour”, and sexual promiscuity, thus instantly giving young people a powerful motive to binge-drink double espressos, and a perfect excuse to behave very badly after doing so.

I could legitimately base many of my scary coffee-awareness warnings on the known effects of caffeine, and I could easily make these sound like a recipe for disaster, or at least for disinhibition and public disorder.

It would not take long for my dire warnings to create the beliefs and expectations that would make them self-fulfilling prophecies. This may sound like a science fiction story, but it is precisely what our misguided alcohol-education programmes have done.

Over the past few decades the government, the drinks industry and schools have done exactly the opposite of what they should do to tackle our dysfunctional drinking. I remain perhaps stupidly optimistic that eventually they will find the courage to turn things around and start heading in the right direction.

The writer, anthropologist Kate Fox, is a Director at the Social Issues Research Centre, which appears to be a voice of reason, often calling for evidence based social policy.  However, Fox is not immune from criticism.  The British Medical Journal has noted the close relationship between the SIRC and a public relations outfit run by the same directors from the same building, funded mostly by the alcohol industry.  It makes one suspicious to say the least, particularly about their positions in relation to alcohol policy, but the SIRC seems to have a much broader research focus than alcohol, covering obesity, dining habits, football culture, online habits, safety standard, motherhood, commercialisation of childhood and so on.

In any case, Fox’s claims seems to be supported by anecdotal evidence, as any well travelled wine or beer lover will tell you.

Cultural norms are powerful.  They are often deeply connected to people’s identity, and thus economic intervention in the form of relative price changes – to the price of money itself to consumer goods such as alcohol, cigarettes and junk food – may not be as effective as the promotion of modified cultural norms.  Indeed, any intervention to encourage productivity at a national level need to be aware of the existing norms driving current conditions.

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Comments

  1. Kate Fox has to having a lend of us. If you ban something or otherwise limit it you might make people want to access it. I get that. But caffeine does not have the same pharmacological effects as alcohol. Therefore to suggest that the same anti social behaviors would arise from making caffeine taboo, or otherwise restricted, is just (alcohol industry PR funded?) bullship.

    • She is taking the analogy to extremes, which is why I posted that excerpt. But there have been plenty of studies with placebos showing that social behaviour responses to alcohol is also the result of social expectations.

      Yes, alcohol has an effect on the body, but how we interpret this effect in our behaviour is very subject and driven by social expectations.

      Don’t underestimate the power of expectations / placebo effect. The existence of alternative medicines must go some way to showing how easily our expectations provide the outcomes we want.

      • I’m not underestimating the effects of social conditioning but I cannot imagine a society in which a bloke with have lots of coffee and then go home and beat up his wife or want to fight everyone in the cafe (due to the effects of the coffee). Likewise I’ll take bets from anyone that if you give someone a skinful of placebo grog (i.e. alcohol free) you will not witness the same level of violence, car accidents etc. We have 0.05 blood alcohol level limits for pharmacological reasons.

        By seemingly ignoring pharmacological effects she is way way off the mark.

        Ditto substitute heroin, crack, meth (breaking bad!) etc in this discussion.

        Lets get fair dinkum about it and realize that these things biochemically effect you and your behaviour.

        • I have read studies that suggest ‘wife bashing’ is cultural being handed down from father to son generation after generation. It is also a popular passtime in alcohol free cultures like the middle east.

      • Just to be clear I don’t deny that things like binge drinking/consumption can be, or are, cultural. And I’d imagine it would be possible to engineer a culture in which people binge drink coffee.

        Where this analysis breaks down would be a link between binging and subsequent behavior because it ignores the pharmacological effects of the chemical you are binging on.

        To demonstrate that just lock yourself in a room and drink coffee all day and the next day lock yourself in a room and drink grog all day (or take heroin, crack, meth …). The effects of each chemical on your pharmacologically, when you binge, is significantly different.

        The drivers to cause you to binge may or may not be cultural. What you do when intoxicated, i.e. post binge, is largely due to pharmacology.

        • “The drivers to cause you to binge may or may not be cultural. What you do when intoxicated, i.e. post binge, is largely due to pharmacology.”

          As Rumplestatskin says in his original article, anecdotal evidence suggests otherwise, eg: in European countries where alcohol is easily available but the quantity and severity of problems seen in the Anglo countries are absent.

          Anyone who has travelled will tell you that the French or Germans love a drink just as much as Australians – but the chances of getting assaulted on a night out in either of those countries is relatively miniscule.

          The overarching point is that the results of alcohol consumption – even high alcohol consumption – are not a consequence of the biological effects, because if they were they’d be consistent across countries and cultures.

          • You’re confusing the social influences that cause binges with the resulting anti social effects of binges.

            The anecdotal evidence you refer to, which I am not disputing, is for the former.

            The quote from Kate Fox is unambiguous. She believes that she could engineer coffee binges AND that the effect of those binges would be rampage around town centres being anti-social, getting into fights and having unprotected sex in random one-night stands.

            The first part I suspect is true. i.e. that binge behaviour is predominantly cultural.

            The second part is absurd nonsense. Binging on coffee does not induce the same pharmacological effects as binging on alcohol. (or binging on heroin or binging on chocolate, jelly beans, vitamins, etc. …I mention those others since it is implied that binge behaviour for anything can be engineered and produce the same effect as alcohol).

            So while it is conceivable that a society that binges of coffee could be created (or binges on jelly beans or anything else). to expect the effects of the binging to be the same as alcohol binges is pretty loopy.

      • Agreed its not the best analogy, but there’s no question – in my mind – that the Australian binge drinking culture has been accelerated by the policy response, which has been replicated in other “nannying” areas.

        Replace coffee with cars or motorbikes in that analogy – i.e a high risk activity and it works.

        The real underlying problem is why do people want to drink to excess? Or hoon in cars? This is a psychological problem that then becomes a physical problem.

        And again, it interferes with the liberty of those of us who enjoy drinking (and riding motorbikes and driving cars) responsibly.

        • The quote from Ms Fox suggests she believes that if another product had the identical social treatment as alcohol you would get the same outcomes. In other words binging leads to “rampage around town centres being anti-social, getting into fights and having unprotected sex in random one-night stands.”

          I am saying that the social conventions can cause the binging but the pharmacology dictates the behavior of the binged.

          She used caffeine as an example. Let’s use jelly beans. It may be possible to produce a society that binged on jelly beans (in some parallel universe but I’m being serious). But would we see an increase in car accidents because people are over the jelly bean limit?

          (or an increase in car accidents from caffeine binging if we stick to her example)

          So I think she confuses the social conventions that may cause binging, with the ultimate outcomes of the binging (due to the pharmacological effects of the binge material).

          As to why people binge? I think she has probably nailed it.

        • dumb_non_economistMEMBER

          Prince,

          Sorry, couldn’t disagree with you more, Australia’s drinking culture goes all the way back to the convicts. It’s something we imported with the Irish and Brits.

          Go back to the 50/60’s and the 6 O’clock swill before closing time. When I was 20 (1980) not many nightclubs open and most restricted to 3.00am, know late licences abound and go to 6.00am, places open ALL weekend, no more Sunday sessions just all day drinking. Most men went to the pub straight after work, especially Friday nights. Add to that the huge increase in women following their male counterparts and we have what we have today, nothing to do with nanny state behaviour, which imo is grossly exaggerated.

          Our drinking culture is a century old. An American work mate, correctly I think, describes Australia as a functioning! alcoholic

  2. Intersting topic. Bhutan is the happiest country in the world, their religious or social norms is that Beer and sex is valid path of enlightnment. Would Australians be happier in Bhutan. I suspect they would

  3. The outcome of Greeks and Germans swapping places?
    Hard to say, presumably at least some of the Greeks would learn about planning and sticking to a plan in order to survive a central european winter…but it would be very messy at first (famine, freezing to death). I expect the surviving Greeks would eventually become somewhat better organised.
    The translocated Germans would not be under the same kind of pressure in respect of a winter, but Greece does have its own geographic problems which the Germans would deal with in an organised manner. Could the Germans learn to relax a bit once it became clear their geography no longer required such a level of effort to overcome? Maybe, but overcoming the cultural propensity for worrying about, and therefore planning for, the future would be very difficult for Germans. I occasionally holiday with my German relatives and can report it is anything but relaxing…activities are planned and executed with military precision.
    As for the claims from Kate Fox….I think she is right and you could extend those exact arguments to explain why illicit drugs have such wide currency in our society…I have long believed they should all be legalised, thereby simultaneously removing both the value that makes their supply attractive to criminals, and the appeal of illegal activities to adolescents.

    • Of course cultural norms are important. They shape one’s ideas about happiness, success, motivation and in general the life.

      I see this every day at my Uni where I teach and research. Just look at the first generation immigrant kids. They may not be as bright as local students; they may have problems with effective communication, but you cannot doubt their drive to excel, their ability and readiness for hard work that is necessary for success.

      And local students? Bah. Some of them are really bright, but on an average, they are lazy. They prefer not showing up for lectures, not doing homework, and here is classic—getting wasted drinking while lounging on the lawns on gorgeous sunny day. A significant portion of them see higher education as an entitlement, an easy ride to a better life.

      Sure, there are and there will be exceptions. But trends are clear to anyone who cares. And no, this is not an ethnicity issue, second generation kids work less harder than the first generation.

      So setting economic policies without any regards to underlying cultural currents is silly, because culture does matter.

      • Excellent comment coolnik. This is one example I’m sure many can relate to.

        You noted that –
        “A significant portion of them see higher education as an entitlement, an easy ride to a better life. ”

        I see the origins of this attitude probably came from their parents. In the 1970s university was ‘free’ – there was a huge push in the 1960-80s to get more students into university.

        I married into a different culture and reconciling cultural differences is a family ritual.

      • “Sure, there are and there will be exceptions. But trends are clear to anyone who cares. And no, this is not an ethnicity issue, second generation kids work less harder than the first generation.”

        Is this not merely the common result of _any_ increase in wealth and access to more advanced technology ?

        Should we in first world countries be feeling guilty because we aren’t working as hard as those in third world countries, or should we be thankful we don’t have to and enjoy our newfound leisure time ?

        • “Should we in first world countries be feeling guilty because we aren’t working as hard as those in third world countries, or should we be thankful we don’t have to and enjoy our newfound leisure time ?”

          Dude, sigh. Talk about our attitude toward hard work in education and we get to hear this. This comment really tells what is the problem.

    • darklydrawlMEMBER

      The greatest PR scam pulled so far is the way the Alcohol industry have managed to seperate themselves from ‘Drugs’ – it is always “Drugs and Alcohol”. Duh, Alcohol IS a drug – and can be a rather harmful one at that. (heh, but I do drink it regularly).

      And I agree all illicit drugs should be at least decriminalised. The current policy of prohibition is doing far more harm than good.

      Besides, anyone who wants to buy illict drugs already does. All the current system does make some folks very wealthy at the expense of others.

      In South Australia they decriminalised pot years ago. Current rates of consumption? About the same as everywhere else. Made no difference at all.

      Trouble is too many folks make a killing out of the status quo. On both the supply and enforcement side. Going to be hard to change, but change it must.

  4. Cultural norms have a huge impact on behavior, but it can be very hard to see it from inside the culture- and hard to understand the nuances from outside. It is one of the issues with economics, that assumes that all people behave in the same rational manner.
    I suspect that there are Greeks in Germany, who fit into the german work etheic and work hard- but they moved there in order to do so.
    Immigration allows those who want to be outside part of the culture to do so. Greeks and Italians who moved to the US or Australia were hardworking (and more business oriented)- they moved to find a better life for themselves and in moving to a more work focused country were able to do so. They may not have had the opportunity to create such businesses, and to express ambition in their home country.
    Conversely, the Germans who emigrated to the US went for reasons other than purely economic- in the 19th century at least. They were fleeing the prussian military state. While they didn’t slack off economically, they didn’t turn into significant economic powerhouses either- they brewed beer and had farms.
    As an imported citizen, and the child of immigrants, it is harder than expected to lose cultural conditioning, even when aware of the factors and the national myths. (australia’s is that we are all battlers, the US is that even a shoeshine boy can make millions- and they explain a lot about our respective messes)

  5. rob barrattMEMBER

    Alas and alack poor Kate.
    Methinks the words ‘courage’ and ‘government’ mixed by association in the same piece brings nae comfort as to her state of mind.

  6. My observations strongly point to Kate Fox and Rumple being correct on the things that determine behaviour which is why we have to be very careful in designing laws which govern economic behaviour.

    However, my take on this post is that Germans would turn into Greeks and vice versa. Maybe slowly but inevitably

  7. Rumplestatskin, I promise you you are onto a gold mine of analytical thinking here. Both Marxists and free marketers tend to be “culture blind”. Culture is actually the most important thing in economic outcomes.

    In a famous passage, Polanyi, Arensberg and Pearson (1957); “Trade and Market in the Early Empires: Economies in History and Theory” p. 250; write: “The human economy … is embedded and enmeshed in institutions, economic and non-economic. The inclusion of the non-economic is vital. For religion or government may be as important to the structure and functioning of the economy as monetary institutions or the availability
    of tools and machines themselves that lighten the toil of labor.”

    Edward BANFIELD’s 1958 book, “The Moral Basis of a Backward Society”, argues that mistrust, envy, and suspicion of one’s fellow men, is a powerful inhibitor of economic growth.

    David S. LANDES 1999 book, “The Wealth and Poverty of Nations; Why Some Are So Rich and Some Are So Poor” is also a famous commentary on this subject.

    Specifically giving credit to Protestantism, the book; “The Protestant Ethic and the Spirit of Capitalism” was written by the famous German economist Max Weber in 1905; it was translated into English in 1930.

    The academic authors GUISO, SAPIENZA, and ZINGALES, have authored several papers including “Does Culture Affect Economic Outcomes?” (2006) and “Civic Capital as the Missing Link” (2010).

    Another significant current academic author team, is Robert BARRO and Rachel McCLEARY (who also continue their research in this field):

    “Religion and Economic Growth” (2003)

    “Religion and Economy” (2006)

    Rachel McCLEARY is the author of a very readable overview paper in 2008, in “Policy Review” Magazine, entitled “Religion and Economic Development”.

    Lewis M. Branscombe is the author of a remarkable essay, “Social Capital: The Key Element in Science-Based Development”.

    Also see Steven Knack and Philip Keefer, 1996. “Does Social Capital Have an Economic Payoff? A Cross-country Investigation”

    And Stephen Knack and Paul Zak. 2001. “Trust and Growth.”

    • rob barrattMEMBER

      PB
      During the 80s I worked in Holland, Germany, Belgium & France as an IT contractor for nearly 10 years. There are certainly differences in what we would call work ethic that appear to stem from cultural differences.
      Without denigrating anyone, there is no doubt the Germans were the hardest working. That ethic went beyond 9 to 5. If, for example, a person didn’t clean the snow from the drive outside their block of apartments, their fellow residents would pay someone to do it and send them the bill. Basically, you sought order and you obeyed orders. That helps expain a lot of history, good & bad…

      • A friend of mine was a grad student in Germany. He had rooms in a boarding house. One day he moved some of the furniture around a bit, which prompted the landlady to grill him about whether he was an anarchist.

    • Negatively, the book “Being Indian” by Pavan K. VARMA, is an exploration of why Hindu culture prevents economic progress; and “The True Believers” by V S Naipaul does the same for Muslim culture. These are popular, readable books, not economic or philosophical tomes.

  8. The ready availability of alcohol in Europe, I noticed you could even buy beer on the railway platforms in Germany, was quite an eye opener for me, especially as it seemed to be absent the anti social problems we & the British have. The retail price is also much cheaper in most countries – kind of depressing to see how cheap quality beers and wines are in the supermarket over there.

    It certainly makes me question the direction we are taking with alcohol policy in this country, it seems to have been hijacked by a bunch of wowsers who won’t stop until prohibition is introduced. Are we truly a nation of dickheads who can’t handle their piss, and thus need draconian rules to keep us in line, or is there a way of changing our drinking culture, which still seems to have a bit of that six o’clock swill mentality about it.

    • I suspect the fact that alcohol was manipulated as a currency during the early colonial years still has a lot to do with the way it’s viewed here, including the propensity to heavily tax an item it appears the population can never have enough of. Climate and a general feeling of alienation in this continent also plays a part in high consumption levels.

  9. Yes it was quite interesting to explain to my asians &/or muslims friends in Australia that binge drinking was not the norm in the western world, pretty much only in anglosaxon world.

    I ve never seen a drunk girl in France, ever at uni, and very few drunk guys (and I was party organiser at Uni 😉 ).Here it is ridiculous.

    • rob barrattMEMBER

      Right about France, same in Italy which has
      cheap alcohol, but really bad socially to get drunk at a friend’s party.

      Lord Wellesley the Duke of Wellington was right, to paraphrase two famous quotes “I hang em and flog em to keep em in line” and “I don’t know what the enemy think of them, but they put the fear of God into me”.

      Australia and the old British navy, oustanding in a fight (and on the sports field), but keep em off the rum.

  10. 🙂 Nice one Rob!

    Great topic Rumples. As a result my brain is in motion but, perhaps as usual, not coming up with much…yet!

    Not to divert the topic in anyway but I thought it was a great observation on the German propensity for perfection.
    I was watching a programne on the history of the Second World War. There was a fairly large and detailed section specifically in relation to Battle Tanks. In discussing a German Tank engineering the machining tolerances in the particular tank would allow the engine in the tank to run for either 13 or 15 years more or less continuously. The problem was that the life of a German Battle Tank at that stage was 6 weeks.
    I guess they do what they do because they do!

  11. It’s well known that when Germans go to Greece they get up super early and commandeer the sun loungers.

    Productivity out the window…

  12. In most cultures, people eat when they drink, or at least drink on a full stomach, as a rule. In most places, serving food with alchohol is just common sense, even if it’s just tappas or some other kind of snack.

    In Australia and other places with “drinking problems” people regularly drink without food. What we really have is a “drinking on an empty stomach problem”.

    It’s that simple.