Post by Sapphire Capital on Aug 13, 2008 1:04:24 GMT 4
Collective Goods, Free Riding and Country Brands: The Chinese Experience
Jay B. Barney
affiliation not provided to SSRN
Shujun Zhang
National Sun Yat-sen University - Department of Business Administration
Management and Organization Review, Vol. 4, Issue 2, pp. 211-223, July 2008
Abstract:
Company brands signify a message to consumers about the quality and value of a product. Countries can also be branded. However, unlike the brands of individual firms, country brands are collective goods. The nature of country brands creates the possibility of free riding, where individual firms benefit in terms of price or access from the promise made by a country brand but deliver at a level lower than what is promised by the brand. Such free riding threatens the stability of what the country brand represents unless legal, governmental, or other institutions engage in activities to reduce these adverse effects. In this paper, we investigate the Chinese brand once standing for average quality at a low price in the light of recent recalls. We examine how country brands emerge and the incentives that firms operating in a country have to either support or not support a country brand. We also explore the implications of these incentives for the role of various institutions, including the government, in developing, maintaining and changing a country brand and in developing and enforcing the policies, such as protection of intellectual property, necessary to support firms efforts toward reinforcing a trusted country brand.
papers.ssrn.com/sol3/papers.cfm?abstract_id=1158776
Jay B. Barney
affiliation not provided to SSRN
Shujun Zhang
National Sun Yat-sen University - Department of Business Administration
Management and Organization Review, Vol. 4, Issue 2, pp. 211-223, July 2008
Abstract:
Company brands signify a message to consumers about the quality and value of a product. Countries can also be branded. However, unlike the brands of individual firms, country brands are collective goods. The nature of country brands creates the possibility of free riding, where individual firms benefit in terms of price or access from the promise made by a country brand but deliver at a level lower than what is promised by the brand. Such free riding threatens the stability of what the country brand represents unless legal, governmental, or other institutions engage in activities to reduce these adverse effects. In this paper, we investigate the Chinese brand once standing for average quality at a low price in the light of recent recalls. We examine how country brands emerge and the incentives that firms operating in a country have to either support or not support a country brand. We also explore the implications of these incentives for the role of various institutions, including the government, in developing, maintaining and changing a country brand and in developing and enforcing the policies, such as protection of intellectual property, necessary to support firms efforts toward reinforcing a trusted country brand.
papers.ssrn.com/sol3/papers.cfm?abstract_id=1158776