In the UK, precedents are set by the decisions of the High Court (civil) or Crown Court (criminal), and by higher courts. Lower courts don't set precendents I believe - IANAL.
I don't know - I think all legal systems use precedents to a certain extent - they're just extremely formalized in America and Britain. Sorry but I'm not familiar enough with their system to reply with confidence but I would say that if a high court in a country rules a certain way, even if that isn't binding to future rulings, it will cause people to adjust their behavior to avoid falling into a trap that's been clearly called out already.
Courts in a common law jurisdiction (like the UK and US) don't have to try to set a precedent, each ruling tends to set a precedent. That is what makes common law common, the same law is applied everywhere, so any new ruling would be applied everywhere. This is exactly why judges avoid making rulings that would set a new precedent! I hope I haven't oversimplified a complicated subject!
Per Wikipedia Germany's legal system doesn't have the concept of binding precedent. (And even if it did in no country is the decision of a trial court binding precedent).
Precedents matter everywhere. In countries where precedents are not law, decisions from higher-level courts are still guiding the decisions of lower-level courts – so the effect is somewhat similar.
Non-English speaking Europe generally has the civil law system as opposed to common law and doesn't use precedents except in the most ambiguous cases where precedent can be used as guidance for interpreting the law. Precedent alone cannot be used to make a decision and it cannot contradict the law. Judges also have much less freedom in their interpretations of the law.
I am not quite certain how much a precedent matters here.
Of the western world we have the US, UK, and Canada that employ common law where precedent really matters.
In most of the EU the system of civil law is used, where the judiciary is expected to be much more literal and to not perform much interpretation or reference to previous interpretations.
While in most European countries, precedent doesn't have much power, it can still be used as an indicator on how to interpret law or judge how a court case would go. There is also the higher courts in most countries, which don't set precedent but can set a modus operandi for courts to follow.
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