ABSTRACT
In this chapter, culture is introduced into a behavioral model of the firm as a causal variable in the growth and development process and, more specifically, as a determinant of labor productivity and thereby of the level of gross national product (GNP). Weber's conception of the relationship between culture and economics is notable given this chapter's focus on the relationship between culture and material welfare. Moreover, social capital is introduced into the economic agent's preference function and is thereby explicitly introduced as a possible determinant of behavior. Becker's modeling therefore opens the door to modeling culture as a determinant of effort inputted into the production process, a move that Becker himself does not make. In the behavioral model, the culture counts as a substantive determinant of material welfare.
