Self-Efficacy and Modernization On the Origin of Change Self-efficacy is the critical link between environment, culture, institutions, and modernization. It is the primum movens of change through learning by enabling human adaptation to environmental and circumstantial stimuli. Self-efficacy develops everywhere at all times, but in different strengths, domains, and levels. It is equally required in both developed and less developed economies. A lack of self-efficacy in leaders, elites, and ordinary electorate can foster retreating to manipulation or force, to exploitation and circumventing rules to pursue one ́s interests. Self-efficacy is not genetic but learned and culturally transmitted. Individuals and communities with high self-efficacy believe to be able to learn and change their behavior favorably, and profit from doing so because they have learned that through positive past experience in a effort rewarding environment. Their past success begets future success through opportunity recognition, higher risk taking, better cooperation, and higher and longer investment. In contrast, individuals and communities with low levels of self-efficacy experience an unrewarding environment that does not support their efforts, and thereby does not foster learning and change and the development of higher self-efficacy. In a self-fulfilling prophecy, without experiencing positive consequences to one ́s activities, one will resist or not actively seek change because of the belief to fail. Fortunately, the development of self-efficacy can be nurtured by targeted policies and measures. Better understanding how self-efficacy works and develops will increase the efficiency and effectiveness of economic development and modernization policies. The goal of these policies is to foster economic performance and societal progress. Economic performance reflects how much humans change their habitat, while culture reflects the collective experiences in that habitat in norms, habits and rules. Self-efficacy as the origin of human behavior change vitally influences economic activity and social progress as changes can be brought about by the belief in one ́s abilities without retreating to force or manipulation.