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According to Hofstede’s (1991) definition, “individualism pertains to societies in which the ties between individuals are loose: everyone is expected to look after himself or herself and his or her immediate family.”
Collectivism, on the other hand, “pertains to societies in which people from birth onwards are integrated into strong, cohesive in-groups, which throughout people’s lifetime continue to protect them in exchange for unquestioning loyalty.”
Hofstede, a social psychologist, claimed that industrialised, wealth, and urbanised societies tend to become increasingly individualistic, and traditional, poorer, and rural societies tend to remain collectivistic.
Oyserman (2002) concluded that the core elements of individualism are personal uniqueness and independence, whereas the main constituents of collectivism are duty to the in-group and maintaining harmony.
In collectivistic East Asian cultures, individuals subordinate their personal goals to collective ones and see themselves as fundamentally connected with others (Markus & Kitayama, 1991), whereas in the individualistic West, most individuals are seen as separate and autonomous, and they live their lives in accordance with personal goals. (Allik, 2004)
Social Capital
Paxton (1999) proposed that social capital seems to involve at least two important components: (a) objective associations between individuals (i.e., the individuals are tied to each other in social life) and (b) a subjective associations (the ties between individuals are trusting and reciprocal). It is a measure of social cohesion.
Allik et al published a table and a graph consolidating metrics of individualism and social capital across 42 countries. In the table below, the Individual Index (IDV) measures the fulfilment and freedom an individual derives from their work. It is measured in the range between 0 (most collectivistic) and 100 (most individualistic). IC measures individualism by studying the personality constructs and behaviour of people across cultures. This is measured on a scale of 1 (most collectivistic) to 10 (most individualistic).
There is a strong correlation between individualism and social capital. Countries in which people believe that “most people can be trusted” and where citizens belong to a larger number of different voluntary associations were also more individualistic, emphasising the importance of independence, personal time, personal accomplishments, and freedom to choose one’s own goals (Allik, 2004). Countries with higher social capital seem to be more democratic as well (Paxton, 2002).
In individualistic countries, people value independence and autonomy but realise that personal benefits are tied to collective benefits. So, people may cooperate due to self-interest. However, this leads to higher levels of interpersonal trust and economic success. Hence, there is a strong correlation between wealth and individualism. Hofstede (2001) theorises that it is wealth that creates individualism.
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