Ilya K. Kapultsevich Cultural Transformation as a Factor of Economic Development: Theoretical Justification and Historical Perspective

DOI: 10.38050/2078-3809-2026-18-2-58-76

Abstract

The article examines the role of cultural transformation as a key factor in institutional and economic development from a historical perspective. Cultural transformation is defined as a shift in informal institutions (norms, values, behavioral models) that enhances the effectiveness of formal rules and reduces transaction costs. Using the theoretical framework of institutional economics and the concept of path dependence, the article analyzes historical cases from Japan, Germany, China, Russia, Chile, Uruguay, Botswana and Rwanda. It demonstrates that successful economic reforms are typically accompanied – or even preceded – by shifts in societal values and norms. The paper explores both top-down cultural strategies (e.g., Meiji reforms in Japan, Chile’s neoliberal transition) and bottom-up evolutionary changes (e.g., China’s post-Mao pragmatism, norm transmission in reunified Germany). The conclusion emphasizes the importance of cultural context in institutional design, particularly in countries facing high institutional constraints. Cultural transformation is thus viewed as an independent driver of sustainable economic growth and a strategic component of modernization efforts.

Keywords: economic development, factors of economic growth, path dependence effect, institutional transformation, cultural transformation.

JEL: B25, E02, E71, Z10.

For citation: Kapultsevich, I.K. (2026) Cultural Transformation as a Factor of Economic Development: Theoretical Justification and Historical Perspective. Scientific Research of Faculty of Economics. Electronic Journal, vol. 18, no. 2, pp. 60-78. DOI: 10.38050/2078-3809-2026-18-2-58-76.

Download