The Relationship between Cultural Changes and Economic Development

Cultural, social, and economic changes are closely correlated, however, understanding such a relationship requires a theoretical model. The current paper has provided a conceptual model for explaining the relationship between culture and economy. Some economists consider culture as resistant to change and some others consider it very flexible. Moreover, some consider cultural values as universal and some as specific to societies. The purpose of this paper is to outline the relationship between these theories and provide a model for the complicated relationship between culture and economic development and understand cultural stabilization and changes. The main question is why some societies are incapable of expanding universal values. We applied conceptual discourse analysis. The analyses are performed in the "new institutional economics" framework. Three issues were discussed: First of all the speed and orientation of cultural changes, then the process of socialization and cultural transfer. The relation between culture and formal institutions and also the Hobbesian problem are the last issues covered in this paper to build a model of cultural stabilization and change in a developing economy.