New Scientist has an article by Ed Yong on the dichotomy between eastern and western thought.
But there are more than two alternatives (western/individualist/analytic vs eastern/collective/holistic)…
Grid-group cultural theory, developed by anthropologist Mary Douglas and others, suggests there are four universal cultural biases, Individualist, Hierachist, Egalitarian and Fatalist. Researchers using this methodology have conducted numerous cross-national studies over three decades to identify the extent to which there are dominant cultural characteristics at a national level. The results seem to concur with some of what is said in this article:
1. individuals are flexible in their cultural biases because the locus of culture is relational or institutional. In other words it isn’t located discretely in the individual’s brain.
2. The existence of the fatalist bias explains why social isolation influences studies. Mary Douglas called this the isolate bias;
3. Honour is an attribute associated with a Hierarchical cultural bias (because it splits the world into more honourable and less honourable elements). However, the east/west dichotomy presented here unhelpfully conflates Hierarchy with Egalitarianism and contrasts this with Individualism, while ignoring Fatalism.
4. Those who persist in using dualisms such as east/west, individualist/collectivist, left/right and so on are really still using a four-cornered scale without recognising it. In each case, besides either/or, there is also both/and and neither/nor. For instance, both individualist and collectivist describes Hierarchy, while neither individualist nor collectivist describes Fatalism.
Daphna Oyserman, who in this article seems to be on to something, manages to avoid any mention of grid-group cultural theory in her work (at least what I’ve read of it so far). It would benefit from a consideration of it.
Four Cultures 
The other thing to remember is that the most collective cultural group are the Inuit and the most individualist are the Maori. Europeans and Chinese are actually closer to the middle between the two, they just happen to be either side of it and some are currently using the minor difference to arbitrarily define themselves. Reminds me of “Asian values” thingo which tended to just look like our values a hundred years ago, ditto with the bearded muslims, Victorian beards were all the rage. Don’t forget fashion in all this craziness, it arbitrary, mean and just plain cruel.
Meika, this is interesting. Where does this analysis (Inuit and Maori) come from?
I agree with you about ‘Asian values’. I’m interested in the interplay, for example, between Japanese art and French Impressionism. Hokusai influenced the Japanese woodblocks that influenced the Impressionists – but Hokusai was himself emulating Dutch and French landscape painting and is in a sense ‘un-Japanese’. So which is East and which is West?
Arrh, you’re pushing me, some reading I did about twenty years ago,
thinks, thinks, thinks, mebbe, Social Being: A Theory for a Social Psychology II, Oxford: Blackwell, 1979. http://en.wikipedia.org/wiki/Rom_Harre but i just might be ascribing it to him wrongly
http://cbbc.georgetown.edu/profiles/harre.html