2010 Reports

Dynamism and Economic Performance: A Preliminary Report

Bojilov, Raicho; Phelps, Edmund S.

This paper is a step in the identification of the determinants of performance in developed economies. A basic finding is that differences in beliefs and attitudes concerning the workplace account for most of the differences in performance. Another finding is that there are four main dimensions, or categories, in which individuals differ in workplace beliefs and attitudes. We find that the most important of them for performance, as we might have suspected, is the one we labeled vitalism. This is followed by materialism (as measured by preference for consumption over leisure), social trust, and self-reliance. We also find that differences in institutional environment have little explanatory power once we control for beliefs and attitudes.