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Error tolerance: entrepreneurship booster or societal risk?

by John Miller
July 20, 2026
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Picture two countries. In the first, a failed business venture is treated as a normal part of life, and the entrepreneur who tried gets a sympathetic pat on the back. In the second, that same failure brings shame, and people think twice before risking it. Which society is better off? The answer, according to a new study, is not as simple as you might hope.

A team of researchers set out to measure something that had mostly been studied inside offices and work teams, not across entire nations: how a society as a whole reacts to human error. Their central finding, published in Applied Psychology, is that a culture comfortable with mistakes tends to encourage entrepreneurship, but the same comfort is also linked to worse outcomes in health, safety, and corruption.

A concept borrowed from the workplace

The idea of “error tolerance” is familiar in organizational research. At the level of individuals, teams, and companies, studies have shown that accepting mistakes, talking about them openly, and learning from them can improve performance, safety, and innovation. Blaming cultures, by contrast, tend to push errors underground where they fester.

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Michael Frese of Leuphana University of Lüneburg in Germany, together with Steven A. Brieger of NEOMA Business School in France and Dorothee Horvath of the Vienna University of Economics and Business, wanted to know whether that logic scales up. Do entire societies develop shared norms about errors, and if so, what do those norms predict?

The authors define error tolerance as a broad acceptance of human fallibility, treating errors as an inevitable part of pursuing goals rather than as something to punish. They lean on a metaphor throughout the paper: Janus, the two-faced Roman god. Error tolerance, they argue, looks in two directions at once. On one side, it reduces blame and opens the door to learning and experimentation. On the other, tolerance implies putting up with something undesirable, and errors can lead to accidents, health problems, and poor quality.

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One complication the researchers flag is the fuzzy line between an “error” and a “violation.” An error is an unintended slip. A violation is a deliberate breaking of the rules. In everyday life, and especially when judging a whole society from the outside, people struggle to tell them apart. That blurring, the authors suggest, becomes important later in their results.

Measuring a nation’s attitude toward mistakes

To capture error tolerance across countries, the team turned to the GLOBE study, a large cross-cultural dataset built from surveys of middle managers. After combining and trimming the data, they had responses covering 58 countries, with about 128 managers rating each one, for a total of 7,794 respondents.

Their measure came down to a single survey item asking whether, in a given society, people are generally tolerant of mistakes. Relying on one question can raise eyebrows, and the authors spend considerable effort defending the choice. They point out that single-item measures are common in social science, and they report that the managers within each country agreed with one another at levels considered adequate. They also compared the GLOBE scores against a separate survey of psychology students collected 10 to 15 years later in 25 countries. The two lined up reasonably well, which the authors read as a sign that the measure is stable over time.

By this measure, Singapore, Germany, France, and Israel scored lowest on error tolerance, while Venezuela, Zambia, and the Philippines scored highest.

The researchers then checked whether error tolerance was just a repackaging of cultural dimensions that already exist, such as risk-taking, collectivism, power distance, uncertainty avoidance, and “tightness” (how strictly a society enforces its norms). The correlations were low to moderate, which the authors interpret as evidence that error tolerance captures something distinct. It was not related to risk preference at all, and only modestly related to most of the others.

The entrepreneurial upside

To test the positive face of the Janus coin, the team linked error tolerance to a range of entrepreneurship indicators drawn from the Global Entrepreneurship Monitor and World Bank data.

The pattern was consistent. Societies more tolerant of errors showed higher rates of people seeing business opportunities, believing they had the skills to start a firm, intending to start one, and actually engaging in early-stage entrepreneurial activity. Self-employment was strongly linked to error tolerance for both men and women. People in these societies were also more likely to view entrepreneurship as a good career choice.

The authors reason that starting a business almost guarantees mistakes, because founders juggle many unfamiliar tasks and face unpredictable markets. Where errors carry less stigma, people may feel freer to try. As they put it, a “non-blaming, tolerant approach to errors makes it easier for people to start a firm.”

There were wrinkles. Error tolerance was negatively linked to the Global Innovation Index, which tracks formal innovation like patents and favors wealthier nations. Entrepreneurial activity by employees inside existing companies was also lower. The authors suggest that innovation in high-tolerance societies may take the form of “jugaad,” an improvised, resource-scarce kind of problem-solving, rather than formal research and development.

The costly downside

The other face of the coin was harder to look at. Error tolerance showed strong links to a cluster of negative societal outcomes. Traffic deaths were higher. People reported feeling less safe. Homicide rates were higher, as were deaths tied to air pollution, undernourishment, child stunting, and infant mortality. Life expectancy was lower.

Two health measures ran the other way: alcohol consumption and smoking, especially among women, were lower in more error-tolerant societies. The authors speculate this may reflect greater traditionalism in some of those cultures.

The relationship with corruption was among the strongest in the study. Error-tolerant societies tended to show more political corruption and weaker control of corruption. Here the earlier point about errors and violations returns. The authors argue that once a society becomes lenient about errors, that leniency may slide into tolerance of deliberate rule-breaking, because from the outside the two look similar. They describe this as a “slippery slope from errors to violations.”

A twisted relationship with wealth

Error tolerance and national wealth turned out to have a complicated connection. Overall, richer countries tended to show lower error tolerance. But when the researchers plotted the relationship, they found a U-shape: error tolerance falls as GDP rises through low and middle levels, then ticks back up among the very wealthiest countries.

Because GDP data stretched back to 1900, the authors ran some analyses looking at change over time and offered what they openly call a “speculative” interpretation. They suggest that economic growth may make societies more relaxed about errors, while high error tolerance may in turn drag down future economic performance by weakening quality and accountability. These are correlational patterns, and the authors are careful not to overclaim causation.

Why what works in a team may fail in a nation

One of the paper’s central puzzles is why error tolerance helps small teams but appears harmful at the societal scale. The authors offer a theory rooted in communication and complexity. In a small team, an error can be caught and corrected quickly through informal, trusting conversation. In a large organization or a whole society, communication is formal and reaches millions, so a mistake baked into a procedure cannot simply be talked away. Complex economies with a fine division of labor depend on countless small things being done correctly, and small errors can cascade into catastrophes.

The researchers also distinguish error tolerance from “error management,” a more active stance that involves catching errors quickly, controlling the damage, and learning to prevent them. Tolerance, they argue, can slide into a passive “anything goes” attitude that lacks that corrective machinery. A validation study using new samples of 90 participants in Germany and 74 in Ireland supported the distinction: error tolerance was linked to less blaming and more forgiving, and to a climate where people take initiative, while error management remained a separate, more active idea.

What to take from it, and what not to

For policymakers, the authors sketch out contrasting prescriptions. Societies with low error tolerance might loosen up by reforming harsh bankruptcy laws and reframing failure as learning, encouraging more people to take entrepreneurial risks. Societies with high error tolerance might strengthen accountability systems to keep that tolerance from curdling into negligence or bribery. The balance they favor pairs acceptance of honest mistakes with mechanisms for prevention and responsibility.

Several caveats deserve emphasis. This is observational research, so the links it describes are associations, not proven cause and effect. The whole cross-national measure rests on a single survey question that mentions “mistakes” rather than “errors,” a limitation the authors acknowledge while arguing that ordinary people use the terms interchangeably. And the validation beyond the GLOBE data covered only two countries. The authors frame their work as a first step, an invitation to build a fuller measure and to untangle errors from violations in future studies rather than a final verdict.

Still, the picture they paint is a reminder that cultural traits rarely come with a simple plus or minus sign. The same openness to mistakes that helps someone launch a business may, spread across a whole society, show up in its traffic statistics and its corruption rankings.

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