Cultural influences in the decision to invest in new ventures: an exploratory study

Do cultural factors influence whether individuals invest in new ventures? If so, do cultural factors influence in whose new ventures they invest? When making economic decisions, individuals are embedded in their society's cultural norms. Because countries differ on cultural dimensions, we hypothesize that an individual's culture influences whether he or she invests in new ventures. Additionally, for those who do invest, we hypothesize that their culture influences whether they invest in a family member or nonfamily member's venture. The results generally support our hypotheses and show that different cultural dimensions influence whether an individual invests in a new venture, and whether s/he invests in a family or nonfamily member's new venture. Because family members are one of the greatest sources of capital for entrepreneurs when starting a business, these results may explain the differences in new venture funding rates and new business startup rates between nations.