Formulation of Hofstede’s Global Cultural Dimension Index (HGCDI): A cross-country study

Abstract

Abstract Hofstede’s seminal work on cross-cultural dimensions was based on his survey of more than 116,000 IBM employees in 40 countries. Hofstede argued that the work-related cultural values and ethics were the closest indicators of national cultures of respective nations and their populations and classified the countries based on the data of six individual parameters (indices). However, a strong necessity was felt for constructing a composite index which will incorporate all the six cultural dimension indices individually and in a collective manner in order to serve two major objectives: first, to establish a linear regressionary relationship between the composite index coined as Hofstede’s Global Cultural Dimension Index (HGCDI) and the individual cultural dimension indices and the Cumulative Cultural Dimension Index (CCDI) respectively [CCDI is the sum of all the six cultural dimension indices]; and second, to derive the regional surface areas of the HGCDI, individual cultural indices, and CCDI which will help us to analyze the dual effects of individual cultural dimension indices separately and collectively on the HGCDI. HGCDI’s computation is based on the complete cross-sectional data sets of 64 countries around the world. The data sets of other countries are purposely omitted due to the paucity or non-availability of data for all the six cultural dimension indices.