Working Paper: NBER ID: w25484
Authors: Gary B. Gorton; Alexander K. Zentefis
Abstract: Social progress through improved treatment of minority groups (the embrace of anti-racist and anti-sexist norms, for example) may or may not spread to corporate cultures through competition. Sometimes the market fails to adapt on its own and government must pass legislation to secure changes in the workplace. We show how corporate culture is determined, why a variety of corporate cultures exist, and whether progressive corporate cultures can oust regressive ones.
Keywords: Corporate Culture; Social Progress; Diversity; Market Forces; Government Intervention
JEL Codes: D23; G3; G38; J31; L13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| market competition (L13) | corporate culture (M14) |
| societal demands for improved treatment of minority groups (J15) | corporate culture (M14) |
| corporate culture (M14) | success in competitive markets (L13) |
| progressive cultures (P39) | adaptation of other firms (L19) |
| cultural cohesion (Z13) | reduced diversity (Q57) |
| reduced diversity (Q57) | harm to overall firm performance (L21) |
| socialization processes (P36) | cultural conflict (F51) |
| cultural conflict (F51) | employee satisfaction (J28) |
| cultural conflict (F51) | employee retention (M51) |
| cultural conflict (F51) | overall effectiveness of corporate culture (M14) |