Culture and Social Influence: Evidence From Online Reviews

Abstract

Evidence from surveys and lab experiments suggests that people’s propensity to conform to the opinion of others is lower in more individualistic cultures. Do these findings hold in real-world settings? This paper quantifies the role of culture as a determinant of social influence in the context of online consumer reviews. Exploring discontinuities in the way Tripadvisor displays average ratings, I estimate how reviewers from different countries respond to the average opinion of past consumers. A discontinuous increase of 0.5 stars in a restaurant’s average rating leads reviewers from countries with the least individualistic cultures to report ratings that are 0.1 stars higher. The size of the effect reduces in individualism and becomes statistically insignificant for consumers from the most individualistic cultures. The negative relationship between individualism and reviewers’ tendency to conform cannot be explained by country-level predictors of individualism, such as income or religion. Moreover, cross-regional variation within Italy reveals that the correlation between cultural values and social influence also holds across reviewers from different regions within the same country. These findings imply that average ratings converge faster to firms’ real quality when reviewers are from more individualistic cultures. (PDF available upon request)