Abstract
Although during the last decades the importance of stock markets has increased in all OECD
countries, the cross-country differences appear to be remarkably stable. In this paper we relate
the factors determining cross-country differences in stock market activity to deeply rooted
norms and values in the society, which are represented by the position of countries on cultural
dimensions. Stock markets are relatively more important in countries where inhabitants accept
more uncertainty and regard competition as a good way of interacting. These attitudes are
represented by the national scores on the dimensions of Uncertainty Avoidance and
Masculinity. Recent research shows that the differences between countries on these cultural
dimensions are very enduring, which suggests that, provided no large shocks occur, the
differences in importance of the stock market are likely to persist.
