COMPANY BRANDS AND NATIONAL BRANDS: HOW REPUTATION AFFECTS FOREIGN SALES
Saturday 27 August 2011, 15:45 - 17:45
Quick Links: Programme Overview • Contributed Session 5 • International Trade IV
| Session: | International Trade IV |
| Category: | European Economic Association |
| Chaired By: | Gerardus Cornelis van der Meijden, Tilburg University |
| When & Where: | Saturday 27 August 2011, 15:45 - 17:45, 20 Helga Eng, room 231 |
| Presented By: | Dorothee Rouzet, Harvard University |
| Co-Author(s): | Julia Cagé, Harvard University and Paris School of Econmics |
The country-of-origin of a good affects consumer demand beyond the predictions of standard gravity models. We explain this pattern by analyzing the effect of firm and country reputation on exports when quality is not observable.Demand is determined by perceived quality, which depends on country reputations for quality and past consumption experience.We find a nonlinear the quality distribution of exporters. Country reputations have a lasting impact on the composition of imports. Countries with bad initial reputation can be locked into exporting low-quality goods. Empirically, we analyze the role of the media as reputation-makers and explore their impact on US imports.
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