National innovativeness
Innovativeness can be defined based on approaches that focus on the adoption of new ideas in a social system, as emphasized by diffusion theory (e.g., Rogers, 2003), or ‘the quality of being innovative’ (Kumar, 2014: 3; for details on different definitions of innovativeness see Deckert & Schomaker, 2018). The latter one constitutes the approach that is taken in this study. Thus, innovativeness comprises conditions which “need to be created for a system to continuously—not just intermittently—induce innovations” and “which can relate to individuals, companies, networks and teams and to whole societies as a multidimensional construct with many levels” (Trantow et al., 2011: 3).
Related to the idea by Trantow et al. (2011), national innovativeness as being focused on in our study can also be understood as innovative capacity (Furman et al., 2002; Porter & Stern, 2001), propensity to innovate (Williams & McGuire, 2010) or innovation performance (Adam, 2013; Gault, 2014). In other words, it is “a country’s potential […] to produce a stream of commercially relevant innovations” (Porter & Stern, 2001: 29), and “the ability of a country to produce and commercialize a flow of innovative technology over the long term” (Furman et al., 2002, p. 899). Not only the outcome in terms of realized or diffused innovations matter, but also “the fundamental conditions, investments and policy choices that create the environment for innovation in a particular location” (Porter & Stern, 2001: 23). National innovativeness depends on knowledge and technology creation and diffusion, thus the support provided by national institutions as research policies, or “networks of related actors and institutions such as entrepreneurs, private enterprises with professional research and development facilities, public research institutes and universities” (Deckert & Schomaker, 2018). These systems are typically referred to as National Innovation Systems (NIS) or National Systems of Innovation (NSI), and focused on in this paper (Freeman, 1995; Freeman & Soete, 1997; Lundvall, 1999, OECD, 1997).
Cultural factors—the tightness–looseness concept
The concept of cultural tightness–looseness as cultural traits was introduced in anthropology to classify different forms of traditional societies along a continuum (Pelto, 1968). Later, Triandis (1989) proposed the concept as an important cultural dimension of modern societies, complementing other cultural features or characteristics as used for classification of cultures before.
Tightness–looseness in the cultural context is defined by Witkin and Berry (1975: 16) as the “degree of hierarchical structure among sociocultural elements in a society” and addresses issues of pressure to conform and social control. According to Triandis (1989: 511), “ingroup members behave according to the ingroup norms” in tight cultures, whereas in loose cultures either norms are unclear or deviations from norms are tolerated. In a similar vein, Carpenter (2000: 41) argues that in tight cultures “norms are explicit and stringently enforced”, while in loose cultures “behaviors that constitute proper behavior are relatively flexible and more freely chosen” and “deviations from norms are more tolerated”. Finally, Gelfand (2012: 420) defines tight societies as “societies that have strong norms and a low tolerance for deviant behavior” and loose societies as “societies that have weak norms and a high tolerance for deviant behavior”.
While cultural dimensions for modern societies typically focus on certain values (e.g., Hofstede, 2003; House et al., 2004), the concept of tightness–looseness focusses on social or cultural norms (Gelfand, 2012; Gelfand & Jackson, 2016), i.e., “socially agreed-on standards for behavior” (Gelfand et al., 2017: 800). Gelfand et al. (2006) distinguish between two key components of tightness–looseness in this regard: first, the strength of social norms as manifested by their number and clarity, and, second, the degree of sanctioning as revealed by the tolerance of deviation from social norms.
Tight societies are usually more homogenous and isolate themselves from external cultural influences (Triandis, 1989). Thus, on average, loose cultures are seen as more creative as they are more open to different ideas, different people and different cultural influences (Gelfand, 2018). Triandis (1989) proposes a weak linear relation of tightness to collectivism. As individualism is usually associated with creativity and innovation (Lubart, 2010), loose societies should also be more creative due to a higher level of individualism. Gelfand et al. (2006) propose that individuals in loose societies usually have a greater promotion focusFootnote 1 and a greater preference of the cognitive style of innovators.Footnote 2 Furthermore, organizations in loose societies have a tendency towards experimentation, trial and error as well as a culture of lower constraints.
Hence, cultural tightness and looseness, respectively, exhibit close relations not only to individual behavior, but also to cultural and socio-economic institutions (Gelfand et al., 2011a: 1102). According to North (1991: 97) institutions are “the humanly devised constraints that structure political, economic and social interaction”. While they can be differentiated in more formal and informal institutions, there is some evidence that social, political and economic institutions are not independent of each other, and a result of societal action and preferences: “Economic institutions, and institutions more broadly, are endogenous; they are, at least in part, determined by society, or a segment of it. Consequently, the question of why some societies are much poorer than others is closely related to the question of why some societies have much ‘worse economic institutions’ than others” (Acemoglu et al., 2005: 389). Thus, Acemoglu and Robinson (2013) argue that societal and political institutions of a country shape its economic institutions. Centralized and pluralistic political institutions such as secure property rights for all citizens, equal opportunities and checks of power set incentives for innovation, as they guarantee functioning markets and foster the market entry of new products, processes or business models. Following this argument, tightness and looseness as factors being correlated to societal values and expressed political preferences, necessarily influence economic institutions via elections, the composition of organizations and organizational behavior.
One important chain of transmission is related to cultural factors. Based on categories from the GLOBE study, Schomaker and Deckert (2020) specify cultural dimensions that influence political institutions and therewith national innovativeness. These dimensions are Power Distance, In-Group Collectivism and Performance Orientation (Deckert & Schomaker, 2018). From these, Power DistanceFootnote 3 and In-Group CollectivismFootnote 4 show a close connection to cultural tightness, as typically high degrees of both of these indicators are related to severe restrictions in personal freedom. A high Power Distance implies stronger tendencies to unequal power distribution, stable and scarce power bases, high levels of corruption, unequal opportunities for the members of society and limited upward social mobility (House et al., 2004). Power Distance is negatively correlated with innovativeness, pluralistic institutions seem to be conducive to innovations while exclusive institutions are detrimental to innovations.
The impact of In-Group Collectivism may be explained through the degree of exclusiveness and clanism in a society that may lead to a solidification of the status quo, as these factors help existing elites to maintain and consolidate their position (Deckert & Schomaker, 2018). Thus, the high correlation between In-Group Collectivism and a high degree of cultural tightness makes it plausible to assume the same effects for the latter one (Triandis, 1989).
Based on these considerations, it can be derived that loose societies due to individual behavior as well as their institutional framework depict a higher level of national innovativeness, while tight groups and societies—and therewith the respective economies—show lower levels of innovative behavior and enabling institutions, and therewith national innovativeness.
Operationalization of cultural tightness–looseness
As for an operationalization of the concept of cultural tightness–looseness as delineated above, two approaches are discussed in literature: first, the tightness score of Gelfand et al., (2011a, 2011b), and, second, the cultural tightness–looseness (CTL) index of Uz (2015a, 2015b).
For constructing the respective scores, Gelfand et al. (2011a) collected primary data from 6960 individual respondents in 33 countries.Footnote 5 For doing so, a survey of six questions was used, tackling the number and clarity of social norms, agreement on social norms, freedom of behavior, degree of sanctioning and compliance to social norms. The items are rated on a Likert scale with six response levels and ranked (Gelfand et al., 2011b).Footnote 6 The higher a country is ranked on the tightness score, the higher its cultural tightness is.
Uz (2015a) applies the concept of variance to determine cultural tightness–looseness, as tight cultures are usually homogenous (Triandis, 1989, 1994), with less variation across individuals in a tight society (Gelfand et al., 2006). For constructing the respective indicator, she uses secondary data from the 4th wave of the World Values Survey (WVS) as conducted in 2000, and calculates the standard deviation of selected items from this survey. The higher the standard deviation of a country, the looser the respective society is (Uz, 2015a).
From this point of departure, she calculates three indices (Uz, 2015a, 2015b): The domain-specific index contains data from the Morally Debatable Behaviors Scale (MDBS) of 68 countries,Footnote 7 which measures the tolerance for moral deviations, i.e., acceptability of prostitution, abortion, divorce, euthanasia, and suicide. The domain-general index calculates the mean of the standard deviations of all 124 items of the WVS of 64 countries. The combination index categorizes items of 65 countries according to the domains of work, family and religion and determines a score of the standard deviation of the domains.Footnote 8
Uz (2015a) proposes the application of the combination index as it conflates the advantages of the other two indices (domain-specific index and domain-general index). The combination index has great variety of values as well as great validity, and its weights of items is independent of the number of survey questions in the respective category.
Hence, the two indicators as discussed measure the same concept—tightness–looseness—applying different methodologies and with a different message: While in the tightness score of Gelfand et al. (2011a) high values indicate for tight cultures, in the cultural tightness–looseness index combination index of Uz (2015a), high values stand for loose societies.
While the concept of tightness and looseness often is discussed separately from other concepts of cultural dimensions typically used in empirical work (see e.g., Deckert & Schomaker, 2018), interrelations between different approaches can be identified. Overall, the tightness score of Gelfand et al. (2011b) has a statistically significant, negative correlation to individualism and a statistically significant, positive correlation to Power Distance as used by Hofstede (2003), with the Hofstede-dimension of Individualism being positively related to innovativeness, the dimension of Power Distance being negatively related to innovativeness (Deckert & Nyssen Guillén, 2017). The indicator of Uz (2015a) is negatively correlated to conformity, and, as will be discussed in the following, positively correlated to innovation as measured by the Global Innovation Index (Uz, 2015b).
Thus, our empirical strategy is based on the following hypotheses as derived from theoretical considerations how tightness and looseness may affect innovativeness. Our working hypothesis is that cultural tightness has a negative relation to national innovativeness, and conversely cultural looseness has a positive relation to national innovativeness. Based on this, we scrutinize the hypotheses as follow in our empirical tests:
H1
The tightness score (TS) of Gelfand et al. (2011a) has a negative relation to national innovativeness.
H2
The cultural tightness–looseness combination index (CTL_C) of Uz (2015a) has a positive relation to national innovativeness.