the impact of cultural values on marketing ethical norms

8/9/2019 The Impact of Cultural Values on Marketing Ethical Norms

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This research investigates the relationship between the culturalvalues and the marketing ethics in two diverse countries: Indiaand the United States. The results show that these countries areindeed culturally different, though the gaps have narrowed con-siderably since Hofstedes (1991) study. Furthermore, the resultsindicate significant differences in the interpretation of the mar-keting ethical norms between these two countries. The studyconcludes with an analysis of how different dimensions of cul-ture influence the different facets of marketing ethical norms

for both countries. Such a framework should provide valuableinsights that international marketers can use to identify differ-ences in the perception of ethical norms across nationalitiesand, thus, to design more effective and efficient internationalmarketing and management strategies.

With the recent revelations about Arthur Anderson, Enron,and WorldCom, the role of ethical issues in business has

become more important than ever. Such issues are even moresalient when dealing in an interdependent global economy.Contemporary scholars (see, e.g., Hofstede 2001; Mead 1994;Trompenaars 1994) have posited that a persons value system

and his or her interpretation of the ethics are greatly influ-enced by cultural background, at both the individual and thenational level. Notably, however, pioneering deontologicalthinkers (e.g., Kant 1959) believe that ethical judgments are

based solely on experiences and are not tainted by the sub-jective lenses through which they are viewed. In Founda-tions of the Metaphysics of Morals, Kant (1959, p. 3) notesthat the basics of moral obligation must not be sought in thenature of man or the circumstances in which he is placed,

but sought a priori solely in the concepts of pure reason. Yettoday, with the advent of rapid globalization, trying to nor-malize activities across countries and across industrial and

service sectors by creating a common set of norms and valuesand, thus, simplifying ethical decision making seems like autopian dream.

The focus of our research is to investigate the relationshipbetween the cultural values and the marketing ethics acrosstwo diverse countries: India and the United States. We chosethese two countries because the recent fast-paced growth inglobalization has accelerated the trade between the worlds

The Impact of Cultural Values onMarketing Ethical Norms: A Study inIndia and the United States

ABSTRACT

Submitted October 2005

Accepted June 2006

Journal of International Marketing

2006, American Marketing Association

Vol. 14, No. 4, 2006, pp. 2856

ISSN 1069-031X (print)

1547-7215 (electronic)

Pallab Paul, AbhijitRoy, and Kausiki

Mukhopadhyay


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29Cultural Values on Marketing Ethical Norms

largest economy of a political democracy (i.e., the UnitedStates) and the fastest-growing democracy (i.e., India) overthe past decade, a trend that promises to continue in thetwenty-first century. According to the Pew Research Centers(2005) Global Attitudes Project, among all countries polled,India had the most favorable impression of the United States,thus holding promise for increased trade between these two

countries. Furthermore, in the past few years, many consult-ant reports, such as the Kearney FDI Confidence Index (seehttp://www.atkearney.com/main.taf?p=1,5,1,168), have con-sistently ranked both countries in the top three preferredcountries in which to invest. More than half of the Fortune500 companies are involved in some form of outsourcingoperation to India, and the rest are busy explaining to theirshareholders why they are not doing so (The Economist2006). The U.S.-based company General Motors aloneimports $1 billion of automotive components from India,and Cisco plans to invest $1.1 billion in the next three years.Similarly, Indian firms, such as Infosys, TCS, and Indian Oil

Corporation, rank among the most prestigious firms in theworld and conduct a fair share of their business in the UnitedStates. More than 65,000 Americans now live in India, andmore than 2 million Indians live in the United States.According to a special report in The Economist(2006, p. 31),Tomorrow belongs to Asia, and perhaps the United Statesneeds India as much as (if not more than) India needs theUnited States. Given the volume of current and future trade

between these two countries and because of the seeming cul-tural differences that exist between the East and the West, itis worthwhile to study the impact of cultural values on themarketing ethical norms in these two countries.

We begin by investigating the differences between culturaland marketing ethical practices in the United States andIndia. After demonstrating significant differences betweenthese countries on both these domains, we explore the inter-relationships between them and subsequently provide guide-lines for designing more effective and efficient internationalmarketing and management strategies. We also provide sug-gestions for further research.

As we stated previously, the goal of this research is to gain abetter understanding of the interrelationships between cul-

ture and marketing ethical norms in the context of the UnitedStates and India. We begin by describing the two factors, cul-ture and marketing ethics, and then we present ourhypotheses.

Culture has long been believed to be the force that influencespeople in a society to follow the norms of their collectiveidentity image. The anthropologist Robert Redfield (1948, p.vii) defines culture as shared understandings made mani-

LITERATURE REVIEW

Cultural Values


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30 Pallab Paul, Abhijit Roy, and Kausiki Mukhopadhyay

fest in art or artifact. Subsequent definitions of the termhave been varied and diverse; for example, Kroeber andKluckhohn (1952, p. 181) find 164 different descriptions,which they classify into seven categories; they suggest thefollowing comprehensive definition:

Culture consists of patterns, explicit and implicit, of

and for behavior acquired and transmitted by symbolsconstituting the distinctive achievements of humangroups, including their embodiments in artifacts; theessential core of culture consists of traditional (i.e., his-torically derived and selected) ideas and specially theirattached values; culture systems may, on the one hand,

be considered as products of action, and on the other asconditioning elements of further action.

Kluckhohn (1962, p. 25) offers a more concise definition ofculture as the part of human makeup that is learned bypeople as the result of belonging to a particular group, and is

that part of learned behavior that is shared by others. It is oursocial legacy as contrasted to our organic heredity.

Cultural dimensions characterize particular groups ofpeople, which take on a supraidentity that constitutes theframework for each individual in the group (Hall 1973; Mar-tin 2001). Recently, House and colleagues (2004) identifiednine dimensions of culture on the basis of a study conducted

by 150 researchers and data collected from 15,000 middlemanagers from 875 organizations in diverse industries in 61countries. Hofstede (1991, 2001) defines culture as the col-lective programming of the mind and finds distinct cultural

differences among people from different nationalities. Hecreated five dimensions of cultural values that differentiatepeoples national culture: collectivism versus individualism,uncertainty avoidance, femininity versus masculinity, powerdistance, and long-term versus short-term orientation.

The first dimension of cultural values, collectivism, pertainsto societies in which the ties between individuals are close:it pertains to societies in which people from birth onwardsare integrated into strong, cohesive in-groups, whichthroughout peoples lifetime continue to protect them inexchange for unquestioning loyalty (Hofstede 1991, p. 50).

In other words, a collectivists identity is based on the socialnetwork to which he or she belongs, his or her opinions arepredetermined by group membership, and harmony and con-sensus in society are the ultimate goals. Japanese and mostother Asian cultures are examples of high-collectivist cul-tures, whereas U.S. and Western European cultures are typi-cally low in collectivism.


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The second dimension of cultural values is uncertaintyavoidance, which is defined as the extent to which themembers of a culture feel threatened by uncertain orunknown situations (Hofstede 1991, p. 113). For example,people of certain cultures, such as Greece and Portugal, seemto be more uncomfortable with unclear, ambiguous, orunstructured situations than people from India and Hong

Kong.

Hofstede (1991, p. 82) defines the third dimension of culturalvalues, masculinity, as pertaining to societies in whichsocial gender roles are clearly distinct (i.e., men are sup-posed to be assertive, tough, and focused on material successwhereas women are supposed to be more modest, tender,and concerned with the quality of life). Conversely, femi-ninity pertains to societies in which social gender roles over-lap (i.e., both men and women are supposed to be modest,tender, and concerned with the quality of life) (p. 83). Japanand Austria outranked all other cultures in the measure of

masculinity, whereas Sweden and the Netherlands were atthe bottom.

Hofstede (1991, p. 28) defines power distance as the extentto which the less powerful members of institutions andorganizations within a country expect and accept that poweris distributed unequally. In other words, countries and/orindividuals with a large power distance expect and desireinequalities among people and believe in authoritarian val-ues and a centralized system. Hong Kong and France areexamples of high-power-distance cultures, and Austria andDenmark are examples of low-power-distance cultures.

The final dimension of cultural values is long-term orienta-tion, which incorporates values such as persistence (perse-verance), the ordering of relationships by status and itsobservation, thrift, and having a sense of shame. The otherend of this dimension, short-term orientation, emphasizesvalues such as personal steadiness and stability; protectingface; respect for tradition; and the reciprocation of greet-ings, favors, and gifts (Hofstede 1991). The differences

between these two orientations are mostly based on Confu-cian dynamism and are characterized by the philosophy ofthe East versus the West, virtue versus truth, and dynamic

versus static. Hong Kong and Taiwan both show long-termorientation, whereas Spain and the United Kingdom are atthe other end of this continuum.

Some researchers have argued that the investigation of cul-tural dimensions at the national level leaves the possibilityof stereotyping because distinct subcultures exist within agiven country (Donthu and Yoo 1998; Lenartowicz and Roth2001). The study of national-level cultural dimensions


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assumes that all individual members of a country exhibit thesame cultural values (e.g., all Indians have a long-term orien-tation, and all Americans have a short-term orientation). Toavoid such broad generalization, individual-level culturalvalues must be measured and then linked to marketingethics, which is an individual-level characteristic (Yoo andDonthu 2002). Therefore, our study also aims to investigate

the effect of individual cultural dimensions on marketingethics for each country. Afterward, a cross-country compari-son will help determine whether there are any importantinsights into the relationship between cultural values andmarketing ethics as a function of the national culture.

The concept of culture implicitly assumes that people fromvarious backgrounds are exposed to their unique traditions,heritages, rituals, and customs, which provide them with dif-ferent learning environments and histories, which in turnlead to variations in moral standards, beliefs, and behaviorsacross cultures. Therefore, culture not only influences learn-

ing but also affects what is perceived as right or wrong,acceptable or unacceptable, and ethical or unethical (Lu,Rose, and Blodgett 1999). As we noted previously, whatdefines a culture is the way that a person pursues his or herobjectives in a given direction. A possible way of under-standing this is to consider the perspective of a system ofaccepted rules and standards of behavior, or a code of ethi-cal values of culture. In other words, in many ways, ethicsoverlaps with culture because it represents the moral dimen-sion of how people should behave in the world. Values areinextricably related when confronting an ethical dilemma.

Subsequently, most models of ethical decision making eitherexplicitly or implicitly incorporate the effects of culture. AsBartels (1967, p. 23) concludes, Contrasting cultures of dif-ferent societies produce different expectations and becomeexpressed in the dissimilar ethical standards of thosesocieties. Hunt and Vitell (1986) embed cultural norms intheir theory of marketing ethics, as do Ferrell and Gresham(1985), who incorporate the influence of cultural and groupnorms on individual behavior in their framework for under-standing ethical decision making.

Business ethics is an extensive domain that encompasses

many domains (e.g., professions, such as marketing, account-ing, and finance; specific sectors, such as health care andinformation technology; see Jakubowski et al. 2002; Miller,Bersoff, and Harwood 1990; Singhapakdi, Vitell, and Franke1999). We focus exclusively on marketing ethics, though ourstudy participants were not limited to marketing profession-als. This is to acknowledge the dispersion of marketingactivities throughout all employees in a firm (Moorman andRust 1999; Webster, Malter, and Ganesan 2005). Note also

Marketing Ethical Norms


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that different constituents (e.g., marketers, consumers, differ-ent ethnic groups) may have different perceptions of market-ing ethics (Christie et al. 2003; Cui and Choudhury 2003;Keenan 2002; Pires and Stanton 2002).

Although there are several definitions of marketing ethics,Hunt and Vitells (1986, p. 7) definition stands out as the

most robust definition: an inquiry into the nature andgrounds of moral judgments, standards, and rules of conductrelating to marketing decisions and marketing situations.On the basis of an investigation of the code of ethics of theAmerican Marketing Association, Vitell, Rallapalli, andSinghapakdi (1993) identify four specific marketing-relatednormsprice and distribution, information and contracts,product and promotion, and obligation and disclosureanda general honesty and integrity norm. The specific items foreach norm explain the conceptualization of these norms.These norms adequately operationalize the concept of mar-keting ethics and are used widely in this stream of research.

Given the close connection between peoples cultural valuesand ethical decision making, scholars have attempted toinvestigate this relationship (Hunt and Vitell 1986; Whippleand Swords 1992). Hunt and Vittells (1986) theory of ethicsproposes that peoples ethical judgments differ because ofdifferences in both deontological moral reasoning theory,which is based on the premise that acts are ethical/unethical

because of their nature, not because of their consequences,and teleological moral reasoning theory, which stipulatesthat acts are ethical/unethical because of their consequences,not because of their nature. Recently, there has been a flurry

of research focusing on the importance of cultural values inlearning ethical behavior and assessing moral issues. Anexample of this is the work of Blodgett and colleagues (2001),who find an effect of culture on a persons ethical sensitivitytoward his or her company, customers, competitors, and col-leagues. In another study, Singhapakdi and colleagues (1999)compare and find some significant differences between con-sumers from Malaysia and those from the United States interms of their perceptions of marketing ethics situations.

However, few researchers have empirically studied howthese cultural values are related to marketing ethics directly

(Lu, Rose, and Blodgett 1999; Vitell, Nwachukwu, andBarnes 1993). An objective of the current study is to examinethe effects of various national cultural values on marketingethics. On the basis of Hofstedes research (and recent stud-ies; see, e.g., Kracher, Chatterjee, and Lindquist 2002; Lu,Rose, and Blodgett 1999), we find that the national culturesof India and the United States are different on most of thedimensions. Moreover, there is both direct and indirect evi-dence of differing levels of ethical values. For example,


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Transparency Internationals (see www.transparency.org)reports show major differences in corruption practices

between these two countries across most national institu-tions and sectors (e.g., business and private sector, media,nongovernmental organizations) and the impact of suchpractices on political life, the business environment, andpersonal and family life.

As we noted previously, our goal is to investigate the impactof cultural values on marketing ethical norms across Indiaand the United States. Specifically, in the past two decades,much attention has focused on national culture as a keydeterminant and predictor of several business activities.Within the field of marketing, Clark (1990) proposes whynational culture is a strong indicator of decision making inglobal marketing contexts, and Adler and Bartholomew(1992) show that it is a powerful predictor of many organiza-tional actions. Subsequent research has shown its impact onnew product development (Nakata and Sivakumar 1996),

product development approaches (Li and Atuahene-Gima1999), and instituting the marketing concept (Nakata andSivakumar 2001), among many other marketing activities.

Hofstedes (1991) cultural framework is a good place to startto measure national cultural values. His typology incorpo-rates most of the cultural conceptualizations and is the mostpopular in this field (Kirkman, Lowe, and Gibson 2006; Son-dergaard 1994). Important relationships between culture anddemographic, economic, political, geographic, and businessindicators have been found using Hofstedes cultural dimen-sions (Dwyer, Mesak, and Hsu 2005; Kale and Barnes 1992).

In our study, we investigated whether these cultural dimen-sions influence marketing ethics in India and the UnitedStates, two countries that are very different on Hofstedes(1991) scales of cultural dimensions but are deeply involvedin trade. Although Hofstedes study is more than twodecades old, no other study since then has found any markedinconsistency on the relative positions of these two countriesalong the cultural dimensions. Finally, we measured the cul-tural values of the respondents from both countries as pri-mary data and then investigated their relationship with thelevel of marketing ethics (which we collected as primarydata as well).

The first dimension of culture, collectivism, integrates allmembers of the society into cohesive in-groups. Further-more, collectivism has been associated with sacrifice (in-group regulations of behavior) and extension of the self to thein-group (interdependence; see Triandis 2004). It emphasizesa prosocial behavior (active protection or enhancement ofwelfare of others) and restrictive conformity (restraint ofactions and impulses that are likely to harm others and to

HYPOTHESES DEVELOPMENT


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violate sanctioned norms; see Schwartz and Bilsky 1987).Because of such great in-group influence and loyalty to thein-group norms, collectivists are more likely to adhere to themarketing norms chosen by their marketing in-group thanare individualists (Yoo and Donthu 2002). Furthermore, col-lectivist cultures are shame based, are tradition bound, andhave stronger moral obligation to their families and societies

to which they belong. They are expected to build harmonywith pertinent groups, such as owners and stockholders,consumers, business partners, and other employees (Vittel,Nwachukwu, and Barnes 1993).

India has an individualism index, or IDV, score (individual-ism is a polar opposite of collectivism) of 48 (ranked 21among 50 countries studied by Hofstede [1991]), and theUnited States has an IDV score of 91 (ranked 1). On the basisof these scores, we expect that the people from these coun-tries will embrace different levels of marketing ethicalnorms. Specifically, we propose the following:

H1a: As a cultural dimension, collectivism positivelyinfluences the levels of marketing ethical norms ineach country.

H1b: In our study, India will have higher collectivismindex (COL) scores than the United States, and thiswill correspondingly indicate higher levels of mar-keting ethical norms in India.

Uncertainty avoidance is the extent to which people areuncomfortable with unknown and unstructured situations.

Societies with higher uncertainty avoidance are likely tohave a stronger fear of failure. Thus, people with stronguncertainty avoidance prefer the status quo and feel the needfor many and precise laws and explicit rules to combat theuncertainty and unpredictability (Ferrell and Skinner 1988).They follow these norms rigidly and with respect, which cancreate a structured situation for them, whereas those withweak uncertainty avoidance are more flexible (Hofstede1991). In general, cultures that accept uncertainty may pro-duce a behavior that is more relativist, negotiable, and con-templative, and such people do not need explicit norms andethical standards. In low-uncertainty-avoidance cultures,

there is a strong tendency to adhere to rules in the businessworld in which the employees are not likely to act unethi-cally, even if it is in the firms best interest. Conversely, cul-tures with strong uncertainty avoidance may need suchnorms to take control of the situation, to reduce ambiguityamong various procedures, and to predict the actions ofother people.


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Therefore, a culture such as that of the United States, whichhas an uncertainty avoidance index, or UAV, score of 46(ranked 43 among 50 countries studied by Hofstede [1991])will follow marketing ethical norms more strictly becausethese norms may reduce the ambiguity in their regular activi-ties, procedures, and behaviors and the resulting discomfort.Conversely, India, which has a UAV score of 40 (ranked 45)

should accept uncertainty without much discomfort (rela-tively) and will have slightly less need for such explicit mar-keting norms.

H2a: As a cultural dimension, uncertainty avoidancepositively influences the levels of marketing ethicalnorms in each country.

H2b: In our study, India will have lower UAV scores thanthe United States, and this will correspondinglyindicate lower levels of marketing ethical norms inIndia.

Masculinity is prevalent in a society in which men areexpected to be assertive and competitive and women playthe role of nurturer and are responsible for the welfare of thechildren. People from low-masculinity (i.e., feminine) cul-tures have been shown to be more compassionate and empa-thetic toward others and to avoid conflict and aggressive

behaviors (Hofstede 2001). As such, they may have strongerethical sensitivities because unethical or immoral behaviorsare believed to lead to group conflict and disrupt socialstructures (Moon and Franke 2000). Managers in a high-masculinity culture are expected to be decisive and assertive

rather than intuitive and consensus seeking. Such a culturestresses equity, competition among colleagues, performance,and resulting material success and progress. Therefore, it can

be argued that people from a masculine culture live to workand tend to pursue success, even at the cost of sacrificingmarketing ethics if necessary. Along these lines, Vittel,Nwachukwu, and Barnes (1993) propose an inverse relation-ship between masculinity and conformity to professional,industry, and organizational codes of ethics, and Yoo andDonthu (2002) validate this. Masculine cultures also havehigher levels of corruption (Getz and Volkema 2001) and aremore likely to overlook ethically questionable business

practices.

From Hofstedes (1991) study, we find that the United Stateshas a high masculinity index, or MAS, score of 62 (ranked 15among 50 countries), and India has an MAS score of 56 (rank20/21). Therefore, we expect that people from the UnitedStates will exhibit a lower level of marketing ethical normsthan people from India. Thus:


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H3a: As a cultural dimension, masculinity negativelyinfluences the levels of marketing ethical norms ineach country.

H3b: In our study, India will have lower MAS scoresthan the United States, and this will correspond-ingly indicate higher levels of marketing ethical

norms in India.

In cultures with higher power distance, less powerful mem-bers of an organization typically accept the unequal distribu-tion of power. This culture reflects a hierarchical organiza-tion in which subordinates expect to be told what to do andthe ideal boss is a benevolent autocrat. These people aremore likely to obey their superiors than to follow informalnorms, such as industrywide codes of ethics (Vittel,Nwachukwu, and Barnes 1993). Yoo and Donthu (2002) alsofind that people with a larger power distance exhibit a lowerlevel of marketing ethics. Furthermore, cultures with large

power distance scores also have more informal leniencytoward rules of civil morality (Hofstede 2001) and a higherdegree of corruption (Getz and Volkema 2001), and theyclaim unentitled benefits, bribes, and stolen merchandise(Inglehart 2000). They respect formalization of authority andprefer vertical top-down communication and, consequently,pay less attention to their peers and informal norms, such asethical standards.

In a cross-cultural study, Lu, Rose, and Blodgett (1999) findthat Taiwanese people show lower scores in the marketingnorms they measured than Americans. Incidentally, Taiwan

has a high power distance index, or PDI, score of 58 (ranked29/30 among 50 countries studied by Hofstede [1991]),whereas the United States has a low PDI score of 40 (ranked38). Therefore, we expect that people from India and theUnited States will show different levels of marketing ethicalnorms because they have diverse PDI scores. The PDI scoresfor India and the United States were 77 (ranked 10/11) and40 (ranked 38), respectively. In particular, we propose thefollowing hypotheses:

H4a: As a cultural dimension, power distance negativelyinfluences the levels of marketing ethical norms in

each country.

H4b: In our study, India will have higher PDI scores thanthe United States, and this will correspondinglyindicate lower levels of marketing ethical norms inIndia.

Finally, people with a long-term orientation tend to have asense of harmonious and stable hierarchy and complemen-


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tarity of roles, support interrelatedness through social con-tracts, stress the keeping of commitments, and have concernsabout the demands of virtue. Schwartz and Bilsky (1987)show that such people are more likely to obey the rules andconform to social expectations and norms to avoid a sense ofshame or guilt. Therefore, they are more likely to adhere tomarketing ethical norms because they are eager to save face

and not damage their reputation. Therefore, we expect thatpeople from India, which has a long-term orientation index,or LTO, score of 56 (ranked 7 among 22 countries studied byHofstede [1991]), will comply with marketing ethical normsmore so than people from the United States, which has anLTO score of 29 (ranked 17). Thus:

H5a: As a cultural dimension, long-term orientationpositively influences the levels of marketing ethicalnorms in each country.

H5b: In our study, India will have higher LTO scores

than the United States, and this will correspond-ingly indicate higher levels of marketing ethicalnorms in India.

Table 1 illustrates our hypotheses.

Following the work of Lenartowicz and Roth (2004), whonote that data of intergroup cross-cultural studies may becollected at the individual level and analyzed at thegroup/country level (for other examples of studies using asimilar rationale, see Gibson 1999; Kirkman and Shapiro2001), we collected data from regular and executive MBA

students in India and the United States, using a self-administered, paper-and-pencil, short questionnaire as aninstrument. Appendixes A and B list the items we used tomeasure the cultural norms and the marketing ethical prac-tices constructs, respectively. The first part of the question-naire consisted of a 24-item measure of marketing ethicalnorms originally derived from the American Marketing Asso-ciation code and validated by a study that used randomlyselected American Marketing Association members as par-ticipants. This scale has been used in various studies in theUnited States and other countries and has been shown to bereliable and valid (Klein 1999; Rallapalli, Vitell, and Szein-

bach 2000). The number of items for each dimension of themarketing ethical norms construct was as follows: marketingprice and distribution norms (5 items), information and con-tract norms (6 items), product and promotion norms (5items), obligation and disclosure norms (4 items), and gen-eral honesty and integrity (4 items). In addition, using all 24items of marketing norms, we created a new compositevariable, overall marketing ethics construct, and correlatedit with the five cultural dimensions.

DATA, SAMPLE, ANDDESCRIPTIVE ANALYSES


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In the second part of the questionnaire, 26 items measuredthe five dimensions of individual cultural values. It was aslightly modified version of the scale that Donthu and Yoo(1998) and Yoo and Donthu (2002) originally used and vali-dated to capture Hofstedes dimensions of culture at the indi-vidual level better. The items included collectivism (6items), uncertainty avoidance (5 items), masculinity (4items), power distance (5 items), and long-term orientation(6 items).

As we noted previously, we purposely selected the United

States and India to reflect variance on the characteristics ofinterest (Douglas and Craig 2006). We chose an exemplarinstitution with comparable characteristics from each coun-try. We used a judgmental (nonprobability) sample in eachcase; informants from comparable MBA programs wereapproached and voluntarily provided data for the study.

A total of 298 students participated in this study, 188 fromIndia and 110 from the United States. All participants from

Table 1.Summary of Hypotheses:Relationship Between theCultural Dimensions andMarketing Ethics

Hypoth-eses

CulturalDimensionVariable

OverallEffect on

MarketingEthicalNorms(MEN) Country Type Differences

H1 Individualism(IDV)

Polar opposite:collectivism (COL)

+ U.S. score = 91 (rank 1/50) > Indiasscore = 48 (rank 21/50)

i.e., IDVU.S. > IDVIndiai.e., COLU.S. < COLIndia

Correspondingly, MENU.S. < MENIndia

H2 Uncertaintyavoidance (UAV)

+ U.S. score = 46 (rank 43/50) > Indiasscore = 40 (rank 45/50)

i.e., UAVU.S. > UAVIndia

Correspondingly, MENU.S. > MENIndia

H3 Masculinity (MAS) _ U.S. score = 62 (rank 15/50) > Indiasscore = 56 (rank 20/50)

i.e., MASU.S. > MASIndia

Correspondingly, MENU.S.

< MENIndia

H4 Power distance(PDI)

_ U.S. score = 40 (rank 38/50) < Indiasscore = 77 (rank 10/50)

i.e., PDIU.S. < PDIIndia

Correspondingly, MENU.S. > MENIndia

H5 Long-termorientation (LTO)

+ U.S. score = 29 (rank 17/22) < Indiasscore = 56 (rank 7/22)

i.e., LTOU.S. < LTOIndia

Correspondingly, MENU.S. < MENIndia

Notes: Ranks and scores are from Hofstede (1991).


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India were enrolled in the regular MBA program, and theU.S. sample consisted mostly of regular MBA students and afew executive MBA students. An examination (with t-tests)showed no significant differences in ethical or culturalevaluations between the regular and the executive MBA stu-dents from the United States. A comparison of the content ofthe curricula in both countries also revealed a reasonably

equivalent coverage of conceptual and theoretical frame-works, with obvious differences in country-specific casestudies.

Although there is likely to be significant within-countryheterogeneity and divergence of cultural values, Hofstede(2001) demonstrates that in most countries, there is a greatdeal of stability with respect to the more fundamentalaspects of both cultural practices and psychological com-monalities within subcultural entities in each nation. Assuch, we chose our sample from comparable MBA programsin both countries. A homogeneous sample of characteristics

in cross-cultural research also satisfies the comparability cri-terion that Craig and Douglas (2005, pp. 29195) and Malho-tra, Agarwal, and Peterson (1996), among others, recom-mend. However, a greater proportion of the Indian samplewas male (84%) than was the case in the U.S. sample (59%),which approximated the gender composition of businessprofessionals in the respective countries. Moreover, thechoice of the MBA students was important because they rep-resent a flashpoint of the debate about whether ethicsshould or can be taught in the classroom. In addition, busi-ness school graduates become the managers who eventuallymake the decisions by which corporate conduct is deemed to

be ethically appropriate or not (Burnett, Keith, and Pettijohn2003). The average ages of the Indian and U.S. samples were25 and 28 years, respectively. On average, the Indian respon-dents had three years of work experience after their under-graduate degree, whereas the U.S. respondents had five yearsof work experience. Notably, almost the same percentage ofpeople in the samples in each country (33% in India versus32% in the United States) were concentrating on market-ing in their curricula. In any case, all respondents had takenat least one marketing course in their MBA curriculum andwere comfortable with the questions asked in thequestionnaire.

Table 2 indicates the correlation coefficients across the fivecultural values and five marketing ethical norms for bothcountries. Cronbachs alphas for all the constructs are allabove .70 (except for long-term orientation and general hon-esty and integrity), thus meeting Nunallys (1978) recommen-dations for reflecting reliability of our measures. Specifically,collectivism measures correlated positively and significantlywith the ethical norms for both countries (p < .01), in support

RELIABILITY, VALIDITY, ANDINFERENTIAL ANALYSIS


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Table 2.Correlation Coefficients forCultural Values and EthicalNorms for Managers in BothCountries

1

2

3

4

5

6

7

8

9

10

11

CulturalValues

1.

Collectivism

.84/.85

.34**

.04*

.0

7**

.13**

.19**

.28**

.27**

.26**

.40**

.39**

2.

Uncertaintyavoidance

.28**

.86/.81

.14*

.13**

.27**

.0

3**

.14**

.08**

.03**

.12**

.07**

3.

Masculinity

.11**

.23**

.84/.7

6

.32**

.1

0**

.1

2**

.1

7**

.2

4**

.2

4**

.1

7**

.2

5**

4.

Powerdistance

.02**

.31**

.52*

.78/.76

.2

0**

.1

7**

.2

2**

.29**

.2

6**

.2

2**

.3

2**

5.

Long-term

orientation

.13**

.20**

.14*

.0

1**

.61/.71

.13**

.28**

.31**

.18**

.14**

.25**

MarketingEthicalNorms

6.

Priceanddistribution

.23**

.38**

.01

*

.11**

.09**

.73/.68

.26**

.30**

.37**

.30**

.63**

7.

Informationandcontract

.37**

.40**

.01

*

.01**

.30**

.43**

.74/.75

.60**

.47**

.49**

.73**

8.

Productandpromotion

.25**

.26**

.05

*

.1

2**

.25**

.40**

.59**

.84/.75

.51**

.60**

.78**

9.

Obligationanddisclosure

.19**

.28**

.06

*

.04**

.21**

.51**

.46**

.43**

.70/.69

.56**

.78**

10.

Generalhonestyandintegrity

.39**

.27**

.07

*

.01**

.27**

.39**

.69**

.56**

.57**

.69/.65

.79**

11.

Overallethics

.36**

.41**

.05

*

.02**

.27**

.75**

.78**

.74**

.79**

.81**

.84/.80

*p

the impact of cultural values on marketing ethical norms

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