Expanding values are clear example of cultural differences which

Expanding the
scope of analysis and assigning culture a significant role helped to explain
the power of development and
underdevelopment.  Culture is
a very vast term; we need to describe it as specific as possible in order to
determine its effect on economic development.  Relation between culture and
economic dynamics has been discussed by various authors. Max
Weber, the German social scientist, concluded that religious values are clear
example of cultural differences which has impact on economic output. Culture
has also impact on behavior of people. Culture represents the behavior of
peoples. Culture relates to economic development
as capital, institutions and social capability. Annual growth rate is basically
based on basic factors of production and also on culture background as other
factors. It uses a number of variables to express these effects, Cultural
background variables are divided in two main groups: “Efficiency Orientation”
and “Social Orientation” variables. “Efficiency Orientation” variables much affect
economic growth, while “Social Orientation” changes are unpredicted. The
results confirm that cultural background has strong role and it’s positively
affects annual growth rates. “Social Orientation” has also positive power for
annual growth rates .Whether directly or indirectly, culture influences the
outcome of economic process or activity. Culture may be considered as the sum
of the values, and perceptions dominating a group of people. Culture understood
as a dimension of social capital growing literature considers social attitudes,
such as trust, as one of the main determinants of current economic development.
Economists
consider trust as the first element of economic culture which might affect the
economic outcome.  Trust is an essential factor for economic activity.
Trust makes investors, policy makers and consumers willing to take part in
transactions with each other, which rise the spending, investing which
ultimately increase growth. Peoples work harder to achieve their goals Economic success
or failure results from people actions. In
this regard, trust and trustworthiness appear as the keystone for successful
economic development.  A nation can’t
ignore culture as a factor of development .The
United States of America said to be where they are today as a result of
management and development of their cultural values. So economist
believe that  culture has impact on
economic development but how much  it
affects economic development, is still a debate among the economists. If
individuals have higher levels of control, the overall economic development
level raises in the economy. Respect, also considered as the cultural
dimension. The higher respect level encourage outsider to trade which leads to
higher economic development level. Culture plays a role in economic
development. Cultural elements may not fully explain the whole relation, but
they are relevant. Whether directly or
indirectly, culture influences the outcome of economic process and cultural
change effects growth of economy.