That is a request from Christina, a loyal MR reader. It sounds like a huge question, and maybe it is, but my answer is pretty simple, which is not to say the problem is simple to solve.
Let’s say you are in Germany. People engage in rule-following behavior, and they become quite emotionally stressed if you suggest you might break the rules in especially inappropriate ways.
Alternatively, in Naples there is more garbage in the streets, and flexibility and rigidity across a very different set of social variables. I call that a difference in “culture,” and I am ready to accept culture as an ill-defined, question-begging term.
Now, how do differences of culture — however defined — interact with traditional economic mechanisms involving prices, incomes, and simple comparative statics? Are those competing explanations, namely cultural vs. economic? Ought they to dovetail nicely in some kind of broader explanation? Or might the cultural factors in some manner be “reduced” to questions of more traditional economics? Some combination of the above? Something else altogether? And, from among these and other options, what principles of differentiation rule how “culture” and “economics” will be related in a particular problem?
That to me is the most important unsolved problem in economics and indeed in social science more broadly.