Individualism, collectivism, and economic development

This article investigates how the prevalence of collectivism or individuali sm in a society relates to the economic development of the society. The cen tral premise of the article is that causality runs in two directions: the c ollectivist or individualist character of a society will influence the cour se of economic development, and simultaneously economic growth and changes in economic structure will alter the orientation of the society toward indi vidualism or collectivism. The recognition of this two-way causality sugges ts four broad hypotheses concerning the interaction between economic and cu ltural factors: (1) economic development is impeded by collectivism and fac ilitated by individualism; (2) economic development is facilitated by colle ctivism and impeded by individualism; (3) economic development promotes col lectivism and erodes individualism; and (4) economic development erodes col lectivism and promotes individualism. The arguments and evidence that have been marshaled in support of each of these hypotheses are examined, and the general themes and implications that emerge are discussed.