Hofstede’s Cultural Dimensions as Predictors of International Competitiveness

In an increasingly volatile global environment, national culture has emerged as a decisive determinant of international competitiveness. This study investigates the relationship between Hofstede’s six cultural dimensions (6D) and the Global Competitiveness Index (GCI) within the EU-25 cluster, exploring how deeply rooted societal values shape modern economic performance. A multi-phase quantitative approach was employed, integrating Pearson Correlation, Multiple Linear Regression (MLR), and Automatic Linear Modeling (ALM). This methodological triangulation allows for the assessment of both direct bivariate relationships and complex multivariate predictive effects across 25 European Union member states using IMD data from 2021–2025. The results consistently identify Power Distance (PDI) as the most influential constraint of competitiveness, suggesting that hierarchical rigidity acts as a structural barrier to economic performance. Conversely, Indulgence (IND) emerges as a significant positive, highlighting the role of societal well-being and creative freedom in driving modern performance. Notably, the final ALM model achieved a predictive accuracy of 78.8%, isolating a significant 4D subset (PDI, IND, MAS, and UAI) as the primary cultural drivers of European competitiveness. This study advances the literature by delivering updated empirical insights for the EU-25 and by demonstrating the higher diagnostic performance of Automatic Linear Modeling over traditional regression techniques in analyzing culture– competitiveness relationships.