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GLOBE practices and values: A case of diminishing marginal utility?

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 Journal of International Business Studies (2010) 41, 1316–1324
& 2010 Academy of International Business All rights reserved 0047-2506
www.jibs.net

COMMENTARY

GLOBE practices and values: A case of

diminishing marginal utility?

Paul Brewer and Abstract

Sunil Venaik The GLOBE study of national cultures identified nine dimensions of culture.
These nine dimensions were measured in the form of societal practices (as
UQ Business School, University of Queensland, things are) and societal values (as things should be). The correlations between
Brisbane, Australia practices and values for societies, surprisingly, were found to be significantly
negative for seven dimensions. Apparently, people’s values are contrary to their
Correspondence: practices. A note, which appeared in a recent issue of this journal, proposes that
P Brewer, UQ Business School, University these anomalous correlations result from diminishing marginal utility. The note
of Queensland, Brisbane, QLD 4072, argues that marginal utility theory applies to cultural dimensions, and that the
Australia. GLOBE values measure societies’ marginal preferences for most of the dimensions,
Tel: þ 61 7 3346 8129;
rather than total preference weights. Through close analysis of the questionnaire
Fax: þ 61 7 3346 8166
items used by the GLOBE team, we show that this is not the case. We demonstrate
that the GLOBE questions, as asked, do not elicit marginal preferences. In fact
they elicit values, as claimed by GLOBE, but recognizing that values may well
be shaped, in part, by existing practices. We call for further study into the
GLOBE scores, as it is likely that different explanations apply to practices/values
relationships across different dimensions.
Journal of International Business Studies (2010) 41, 1316–1324.
doi:10.1057/jibs.2010.23

Keywords: national culture; GLOBE practices; values; marginal utility

INTRODUCTION
In a recent issue of the Journal of International Business Studies,
Maseland and van Hoorn (2009) claim to resolve the puzzle of
significant negative correlations between GLOBE national culture
practices and values scores using the microeconomic theory of
diminishing marginal utility. Their attempt to develop an expla-
nation for the apparently anomalous relationships between GLOBE
practices and values measures is timely, particularly because it
offers a reminder to the academic community of the need to
explain these relationships. However, there are major flaws in the
Maseland and van Hoorn argument that invalidate their explana-
tion, at least in terms of being an important, generalized explana-
tion of GLOBE practices/values relationships. For brevity we refer
to Maseland and van Hoorn as MH from here onwards.

Received: 16 September 2009

BACKGROUND
Accepted: 19 October 2009 The GLOBE study (House, Hanges, Javidan, Dorfman, & Vipin,
Online publication date: 10 June 2010 2004) collected data on cultural attributes, through survey
 GLOBE practices and values
questionnaires, in 62 countries/regions. The goal
of the project was to develop a cultural model,
similar in nature to that of Hofstede (1980,
2001), and apply to it to a range of important
leadership questions. The study identifies nine
cultural dimensions: power distance, uncertainty
avoidance, institutional collectivism, in-group
collectivism, gender egalitarianism, assertiveness,
performance orientation, future orientation, and
humane orientation.
In developing its nine cultural dimensions,
GLOBE collected data for both societal practices
(‘‘as is’’) and values (‘‘should be’’) measures for each
dimension, on the basis that it sought to capture
both the tangible attributes of culture ‘‘e.g., current
policies and practices’’ and the intangible attri-
butes ‘‘e.g., cultural norms and values’’ (Hanges &
Dickson, 2004: 125).1 It seems reasonable that while
practices and values for a society may be different,
they should be positively related: that is, that
people would tend to practice their values. In fact,
the GLOBE authors report there is a significant
negative correlation between practices and values
for seven of their nine national culture dimensions:
assertiveness, institutional collectivism, future ori-
entation, humane orientation, performance orien-
tation, power distance and uncertainty avoidance.
The in-group collectivism practices/values relation-
ship is positive but not significant, whereas gender
egalitarianism practices and values have a signifi-
cant positive relationship.2
The significant negative correlation between pra-
ctices and values across seven of the nine GLOBE
dimensions is one of the most interesting of the
GLOBE findings, because it is so counterintuitive.
The complex nature of these relationships is noted
by Javidan, House, Dorfman, Hanges, and Sully de
Luque (2006: 902): ‘‘Yet it is intriguing to consider
why the relationship between values and practices
is so complex.’’
THE MASELAND AND VAN HOORN
PROPOSITION
MH’s arguments reconciling the values/practices
dichotomy are straightforward. They draw on the
well-understood theory of diminishing marginal
utility, which states that the more of a good a
person consumes, the less preference they will
accord to having more of it. Thus, in cultural
terms, societies that have (i.e., practice) a lower
level of a dimension will have a marginal pre-
ference for (i.e., value) more of it than societies that
have a higher level of the same dimension. MH
Paul Brewer and Sunil Venaik
1317
provide the following GLOBE power distance
questionnaire items to illustrate their point.
For practices:
In this society, people in positions of power try to:
increase their social decrease their social
distance from less distance from less
powerful individuals powerful individuals
1 2 3 4 5 6 7
(GLOBE item 1.26, on a scale of 1 to 7, reverse-coded)
For values:
I believe that people in positions of power should try to:
increase their social decrease their social
distance from less distance from less
powerful individuals powerful individuals
1 2 3 4 5 6 7
(GLOBE item 3.28, on a scale of 1 to 7, reverse-coded)
MH’s argument is that diminishing marginal
utility would result in respondents indicating, in
this example, lower marginal utility, and hence
lower marginal preference for power distance in
their society when they already have high levels of
it, and vice versa. ‘‘That is, (GLOBE) values surveys
by and large measure how much importance soci-
ety attaches to somewhat more (of the dimension)
than there is in the current situation’’ (Maseland &
van Hoorn, 2009: 529). Based on this single que-
stionnaire item, they conclude that the negative
correlations between GLOBE practices and values
‘‘are perfectly compatible with y diminishing mar-
ginal utility’’ (Maseland & van Hoorn, 2009: 530).
At the end of their paper, MH acknowledge that
the GLOBE values measures may contain, in addi-
tion to marginal preferences, some values compo-
nents, and possibly other influences as well, thus
ultimately rendering the GLOBE values measures
useless, as ‘‘one never knows for sure what one is
measuring’’ (p 530).
MARGINAL UTILITY THEORY DOES NOT APPLY
TO MOST GLOBE VALUES ITEMS
On reading the MH article we were suspicious of the
authors’ claim that societal goals or values can be
considered in the same light as consumption goods
(see their note 6: 531). Max Weber (1975) quar-
antined the ideas of utility theory from psychology
by pointing out that the former involves a pre-
sumption of rationality. But, Weber says, ‘‘As we all
know, the assumption does not hold’’ (p 32). While
recognizing the value of economic modeling, inclu-
ding utility theory, Weber dismissed, specifically,
Journal of International Business Studies
 GLOBE practices and values Paul Brewer and Sunil Venaik
1318

the application of marginal utility theory to
psychological behavior, because it treats the psyche
of all people as a ‘‘merchant’s soul’’ (p 32). Of course
this undermines but does not invalidate the
diminishing marginal utility explanation of the
GLOBE practices/values anomalies. However, we
will now proceed to do that.
By looking closely at the actual items used in the
values questionnaire we can see why marginal
utility theory is not relevant. MH select the power
distance questions cited above to illustrate their
diminishing marginal utility argument. Although
MH claim that the questions ‘‘exemplify a value
and practice question’’ (p 528), in fact they are very
unusual. The questions are the only GLOBE items
that use the words ‘‘increase’’ and ‘‘decrease’’. Clearly,
this issue of having ‘‘more’’ or ‘‘less’’ is pivotal to the
application of marginal utility theory. But questions
of this type are the exception in GLOBE questions
rather than the rule. Yet MH simply assume that
inferences relating to their single chosen GLOBE
values item can be applied across all 38 other
questions without further examination.
Examining Specific GLOBE Values Items
MH provide an ‘‘exemplar’’ question from the
power distance dimension to illustrate their point.
We offer the following questions from the future
orientation dimension as a counter-illustration of
the difficulties associated with applying the MH
utility logic. We provide a more generalized discus-
sion of these difficulties in the next section.
For future orientation (FO) practices, one item asks as follows.
The way to be successful in this society is to:
plan ahead take life events as they
occur
1 2 3 4 5 6
(GLOBE item 1-3, on a scale of 1 to 7, reverse-coded)
The equivalent item for future orientation values is:
I believe that people who are successful should:
plan ahead take life events as they
occur
1 2 3 4 5 6
(GLOBE item 3-3, on a scale of 1 to 7, reverse-coded)
Future orientation practices and values have a
significant negative correlation (r¼0.41, po0.01).
MH propose that values questions are asking about
marginal preferences. But how can one interpret
the values question above as being about margi-
nal preferences? There is no ‘‘increase’’ or ‘‘more’’
element to this question. Societies in the lowest
FO practices score quartile (average score 3.27)3
tend to think that taking life events as they occur
is the way to be successful. But this quartile also
has a high average desire (i.e., value) for future
orientation (average 5.63). Why would people who
allow events to occur in order to succeed in life,
advocate planning ahead for members of their
society? But respondents do indeed seem to take
that view, even though there is nothing in the
example question that would remotely elicit mar-
ginal preference due to diminishing marginal
utility, as MH suggest. There is something much
deeper at work here.
Examining All GLOBE Values Questions
The question above is highly illustrative of the
problems the MH proposition raises, but not
convincing in itself; nor is the single MH question
example. Consequently, we have examined in
detail all the questions used by GLOBE to measure
national culture values (see the Appendix for a
complete list of GLOBE values questions.) Accord-
ing to MH (2009: 530), survey questions used to
measure values ‘‘should focus on desired states (the
things weights are about) rather than desired
changes (the subject of marginal preferences)’’
(italics added). Following their suggestion, we
searched through the 38 GLOBE values items for
key words that would reflect change rather than
broad tendencies, both in the questions themselves
and in the two scale end point descriptors. The
words searched for are those appearing in a
dictionary/thesaurus under ‘‘increase’’, and include
‘‘more’’, ‘‘greater’’, ‘‘additional’’, ‘‘further’’, ‘‘added’’,
‘‘expanded’’, ‘‘enlarged’’, ‘‘amplified’’. We also sea-
rched for use of the derivatives of those words plus
7 their antonyms, and also for the comparative
ending ‘‘-er’’ as in, for example, ‘‘taller’’. If there is
a general tendency for GLOBE to elicit marginal
preferences we would expect these words to appear
as part of most GLOBE values questions.
The total occurrences of these words number
7
only nine, in only five questions (see highlighted
words in the Appendix). The word ‘‘more’’ is used
six times, and the words ‘‘less’’, ‘‘increase’’ and
‘‘decrease’’ are used once each. None of the other
words searched for appear in this context. Thus
the argument of MH, that the GLOBE values
questions ‘‘generally elicit marginal preferences’’
(p 527), can be easily ruled out for 33 of 38
questions in the survey: that is, 87% of the
questions. Further, the words ‘‘more’’ and ‘‘less’’

Journal of International Business Studies

 GLOBE practices and values
are used only in gender egalitarianism items. Four
of five GE questions use ‘‘more’’ and ‘‘less’’ (GE-V1,
GE-V2, GE-V3 and GE-V5 in the Appendix). Over-
all, therefore, 80% of the GE questions may
measure marginal preferences. Following the MH
logic of diminishing marginal utility, a signifi-
cant negative correlation between practices and
values in GE is much more likely than in any
other dimension. However, this is the only national
culture dimension in GLOBE that has a significant
positive correlation (r¼0.32, po0.05) between
values and practices. In the case of power distance,
the words ‘‘increase’’ and ‘‘decrease’’ appear once
each in only one values question (PD-V3) out of
the five. However, since the power distance prac-
tices/values score is the mean of all the five items
used to measure this dimension, the measure of
marginal preference in the overall dimension
score will represent only 20% of the total score,
with 80% still reflecting values. Apart from the two
cases discussed above, the ‘‘increase’’-type words
do not appear in values questions for any other
dimensions.
In summary, our analysis shows that the theory
of diminishing marginal utility proposed by MH
to explain the negative correlations between
GLOBE practices and values is totally incompatible
with the positive correlation found in the case
of gender egalitarianism, even though most ques-
tions used to measure this dimension are framed,
according to MH, to elicit marginal preferences.
Furthermore, MH claim that power distance values
measure marginal preferences, even though only
one of the five questions is framed in that way, so
at best marginal preferences could constitute 20%
of the dimension score. And, most importantly,
MH assert that, in general, values in GLOBE mea-
sure marginal preferences even though none of the
questions are worded in that way for any other
dimension. Following Churchill (1979), our analy-
sis of all the GLOBE questions across all national
culture dimensions clearly shows that the que-
stions used to measure GLOBE values are not at
all valid measures of marginal preferences, and
most likely are valid measures of values. We believe
that in their enthusiasm to fit a neat explana-
tion, based on diminishing marginal utility, to the
GLOBE practices–values negative correlations,
MH have wrongly ascribed the meaning of ‘‘mar-
ginal preferences’’ to the GLOBE values questions.
As Mencken (cited in Krugman, 2009) said, ‘‘There
is always an easy solution to every human pro-
blem – neat, plausible and wrong.’’
Paul Brewer and Sunil Venaik
1319
WHERE TO FROM HERE?
We think the explanation for relationships bet-
ween GLOBE cultural practices and values may lie
in the nature of each culture dimension, and in
the precise content and meaning of the questions
used to measure each dimension in the GLOBE
questionnaire. The rationale is quite possibly diff-
erent for each dimension, requiring multiple logics
in explanation. For example, Venaik and Brewer
(2010) propose that, in the case of uncertainty
avoidance, values are opposite to practices because
of different motivational factors impacting on res-
pondents from low and high UA practice countries.
We are of the view that specific factors may well be
at work in respect of all other dimensions. This
claim is further evidenced by the fact that not all
GLOBE dimensions have negatively correlated
practices and values. The situation is made more
complex by the fact that some GLOBE dimensions
are positive, in the sense that they are valued in
all societies (e.g., humane orientation), whereas
one is negative in the sense that all societies aspire
to low scores (power distance) and others are mixed
(e.g., assertiveness). Thus we recommend that each
dimension be looked at separately, in terms both of
the definition of the construct and of the items
used to measure the practices and values of that
dimension in order to fully understand it. Only
when each dimension has been the subject of its
own study can researchers present plausible expla-
nations that are open to further examination and
refutation.
CONCLUSION
The negative correlations between the cultural
practices and values of the dimensions measured
by the GLOBE study are intriguing. Although MH’s
diminishing marginal utility explanation is super-
ficially appealing, after further examination we find
that no generalizable, plausible explanation of the
GLOBE values–practices relationships can be pro-
vided by marginal utility theory. The GLOBE study
provides cultural scholars with an important set of
measures, which should support a wealth of future
culture research. It is up to the academic commu-
nity to develop a more complete understanding of
this asset that we have at our disposal.
NOTES
1
MH state, ‘‘the questionnaire included ‘should
be’ questions, each one corresponding to an ‘as is’
question’’ (2009: 528). Actually, the ‘‘as is’’ (practices)
questions do not precisely correspond to the ‘‘should
Journal of International Business Studies
 GLOBE practices and values
1320
be’’ (values) questions in all cases. Wording sometimes
changes and, in the case of some dimensions, there are
different numbers of practices and values questions.
2
The dimensions with significant negative correlations
(**po0.01, *po0.05) are assertiveness (r¼0.26*),
institutional collectivism (r¼0.61**), future orientation
(r¼0.41**), humane orientation (r¼0.32*), perfor-
mance orientation (r¼0.28*), power distance (r¼0.43**)
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measures of marketing constructs. Journal of Marketing
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House, P. J. Hanges, M. Javidan, P. W. Dorfman & V. Gupta
(Eds), Culture, leadership and organizations: The GLOBE study of
62 societies: 122–151. Thousand Oaks, CA: Sage.
Hofstede, G. 1980. Culture’s consequences: International differ-
ences in work-related values. Beverley Hills, CA: Sage.
Hofstede, G. 2001. Culture’s consequences: Comparing values,
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de Luque, M. 2006. Conceptualizing and measuring cultures
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Paul Brewer and Sunil Venaik
and uncertainty avoidance (r¼0.62**). The only
dimension with a significantly positive correlation is
gender egalitarianism (r¼0.32*). In-group collectivism
has a positive but insignificant correlation (r¼0.21)
(House et al., 2004: 736).
3
Average quartile society scores for both GLOBE
practices and values for all dimensions can be found at
Javidan et al. (2006: 902).
and their consequences: A comparative review of GLOBE’s
and Hofstede’s approaches. Journal of International Business
Studies, 37(6): 897–914.
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New York Times. http://www.nytimes.com/2009/09/06/
magazine/06Economic-t.html?_r¼1&pagewanted¼all.
Accessed 12 September 2009.
Maseland, R., & van Hoorn, A. 2009. Explaining the negative
correlation between values and practices: A note on the
Hofstede–GLOBE debate. Journal of International Business
Studies, 40(3): 527–532.
Venaik, S., & Brewer, P. 2010. Avoiding uncertainty in Hofstede
and GLOBE. Journal of International Business Studies, 41(8):
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Science Quarterly, 56(1): 24–36.
 APPENDIX
See Table A1.

Table A1 GLOBE values ‘‘should be’’ questions

GLOBE R Authors’ Values question Scale point descriptors

question question
number number
1 4 7

3-2 1 AST-V1 In this society, people should be Aggressive — Non-aggressive

encouraged to be
3-10 1 AST-V2 In this society, people should be Dominant — Non-dominant

GLOBE practices and values

encouraged to be
3-14 1 AST-V3 In this society, people should be Tough — Tender
encouraged to be
3-3 1 FO-V1 I believe that people who are Plan ahead — Take life events as they
successful should occur
3-4 1 FO-V2 I believe that the accepted Plan for the future — Accept the status quo
norm in this society should be
to
3-8 1 FO-V3 I believe that social gatherings Planned well in advance — Spontaneous (planned
should be (2 or more weeks in less than an hour in

Paul Brewer and Sunil Venaik

advance) advance)
3-30 0 FO-V4 I believe that people should Live for the present — Live for the future
3-17 0 GE-V1 I believe that boys should be Strongly agree Neither agree nor Strongly disagree
encouraged to attain a higher disagree
education more than girls
3-22 0 GE-V2 I believe that there should be Boys — Girls
more emphasis on athletic
programs for
3-26 1 GE-V3 I believe that this society would Many more women in About the same number Many less women in
be more effectively managed if positions of authority of women in positions of positions of authority
there were than there are now authority as there are than there are now
Journal of International Business Studies

now
3-38 0 GE-V4 I believe that it should be worse Strongly agree Neither agree nor Strongly disagree
for a boy to fail in school than disagree
for a girl to fail in school
3-39 0 GE-V5 I believe that opportunities for More available for men Equally available for men More available for women
leadership positions should be than for women and women than for men
3-9 1 HO-V1 In this society, people should be Very concerned about — Not at all concerned
encouraged to be others about others
3-21 1 HO-V2 In this society, people should be Very sensitive toward — Not at all sensitive toward

1321
encouraged to be others others
Journal of International Business Studies

1322
Table A1 Continued

GLOBE R Authors’ Values question Scale point descriptors

question question
number number
1 4 7

3-27 1 HO-V3 In this society, people should be Very friendly — Very unfriendly
encouraged to be
3-31 1 HO-V4 In this society, people should be Very tolerant of mistakes — Not at all tolerant of
encouraged to be mistakes
3-7 1 IC-V1 I believe that in general, leaders Strongly agree Neither agree nor Strongly disagree
should encourage group loyalty disagree
even if individual goals suffer

GLOBE practices and values

3-12 0 IC-V2 I believe that the economic Individual interests — Collective interests
system in this society should be
designed to maximize
3-36 0 IC-V3 In this society, most people Only individual sports Some individual and Only team sports
prefer to play some team sports
3-37 1 IC-V4 I believe that Group cohesion is better Group cohesion and Individualism is better
than individualism individualism are equally than group cohesion
valuable
3-11 1 IGC-V1 In this society, children should Strongly agree Neither agree nor Strongly disagree
take pride in the individual disagree

Paul Brewer and Sunil Venaik

accomplishments of their
parents
3-23 1 IGC-V2 In this society, parents should Strongly agree Neither agree nor Strongly disagree
take pride in the individual disagree
accomplishments of their
children
3-29 0 IGC-V3 How important should it be to It should not be It should be moderately It should be very
members of your society that important at all important important
your society is viewed positively
by persons in other societies
3-34 0 IGC-V4 Members of this society should Take no pride in being a Take a moderate amount Take a great deal of pride
member of the society of pride in being a in being a member of the
member of the society society
3-5 0 PD-V1 I believe that a person’s One’s ability and — The authority of one’s
influence in this society should contribution to the position
be based primarily on society
3-13 1 PD-V2 I believe that followers should Obey their leaders — Question their leaders
without question when in disagreement
3-28 1 PD-V3 I believe that people in positions Increase their social — Decrease their social
of power should try to distance from less distance from less
powerful individuals powerful people
 3-33 1 PD-V4 When in disagreement with Strongly agree Neither agree nor Strongly disagree
adults, young people should disagree
defer to elders
3-35 1 PD-V5 I believe that power should be Concentrated at the top — Shared throughout the
society
3-15 1 PO-V1 I believe that teenaged students Strongly agree Neither agree nor Strongly disagree
should be encouraged to strive disagree
for continuously improved
performance
3-18 1 PO-V2 I believe that major rewards Only performance Performance Only factors other than
should be based on effectiveness effectiveness and other performance
factors (for example, effectiveness (for
seniority or political example, seniority or

GLOBE practices and values

connections) political connections)
3-20 1 PO-V3 I believe that being innovative Substantially rewarded Somewhat rewarded Not rewarded
to improve performance should
be
3-32 1 PO-V4 I believe that people should set Strongly agree Neither agree nor Strongly disagree
challenging goals for disagree
themselves
3-1 1 UA-V1 I believe that orderliness and Strongly agree Neither agree nor Strongly disagree
consistency should be stressed, disagree
even at the expense of
experimentation and

Paul Brewer and Sunil Venaik

innovation
3-16 1 UA-V2 I believe that a person who Has a lot to be thankful Is missing a lot of
leads a structured life that has for excitement
few unexpected events
3-19 1 UA-V3 I believe that societal Strongly agree Neither agree nor Strongly disagree
requirements and instructions disagree
should be spelled out in detail
so citizens know what they are
expected to do
3-24 1 UA-V4 I believe that society should Almost all situations Some situations Very few situations
Journal of International Business Studies

have rules or laws to cover

3-25 1 UA-V5 I believe that leaders in this Provide detailed plans Allow the people
society should concerning how to freedom in determining
achieve goals how best to achieve goals
3-6 0 NA Question not used
Source: GLOBE website: http://www.thunderbird.edu/sites/globe/globe_instruments/index.htm.
Dimensions are shown as AST – assertiveness, FO – future orientation, GE – gender egalitarianism, HO – humane orientation, IC – institutional collectivism, IGC – in-group collectivism, PD – power
distance, PO – performance orientation, UA – uncertainty avoidance. R: 1¼reverse-coded.

1323
 GLOBE practices and values
1324
ABOUT THE AUTHORS
Paul Brewer is a senior lecturer at UQ Busi-
ness School, University of Queensland, Brisbane,
Australia. He obtained his PhD in management
at the University of Queensland. His research
interests include internationalization of the firm,
psychic and cultural distance, and the globaliza-
tion of business. He was born in Australia and is
an Australian citizen. E-mail: p.brewer@business
.uq.edu.au
Accepted by Alain Verbeke, Area Editor, 19 October 2009.
Journal of International Business Studies
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Paul Brewer and Sunil Venaik
Sunil Venaik is a senior lecturer at the UQ Business
School in the University of Queensland, Brisbane,
Australia. He obtained his PhD in international
business/marketing strategy from the Australian
Graduate School of Management in the University
of New South Wales, Sydney. His research interests
include national culture, MNE strategy and mana-
gement, and the impact of FDI in emerging mar-
kets. Born in India, he is a citizen of Australia and
India. E-mail: s.venaik@business.uq.edu.au.