Nation Equity Research Articles

Modeling transitions in nation brand equity: An empirical assessment of the nation equity power grid

The purpose of this study is to assess longitudinal nation brand performance by modeling transitions in nation brand equity and to develop a method for nation brand performance assessment. This study has two objectives: (1) to empirically test Steenkamp’s nation equity power grid conceptual framework; its categories (dominant, receding, niche, emerging, and weak nation brands), and their expected development trajectories, and (2) to identify new types of nation brands and development patterns to complement the framework. To do this, this study used objective secondary data and applied the smooth transition technique. We assessed 41 countries’ nation brand performance over the 1995–2017 period to understand the development of their nation brand equity. Particular attention was paid to countries that had significantly improved their performance and countries that had lost their brand strength. Our findings support the categories proposed by Steenkamp, but we provide a more nuanced approach to analyzing countries’ brand strength and the possible development trajectories, and introduce new categories of nation brands called volatile nation brands and booming nation brands. Our approach to using the nonlinear smooth transition demonstrated how countries’ brand strength evolved over time, and also detected the speed of any transitions; in other words, how fast nation brands moved from one level to another. Our findings benefit country brand managers, enabling them to better determine their country’s positioning and the necessary means to improve brand equity. Understanding the mechanisms behind transitions in brand equity can also help researchers link these transitions back to various economic, social, cultural, and political transitions that have occurred in nations. Our method therefore has powerful explanatory value for a wide range of marketing, economics, and other social science studies.JEL Classification:M31

International Information Spillovers and Asymmetric Volatility in South Asian Stock Markets

This is the first comprehensive study to investigate the dynamics of international information spillovers, regional linkages and fundamental forces driving return volatility in the SAARC (South Asian Association for Regional Cooperation) member nation equity markets. We propose a multi-factor model nested within the generalized autoregressive conditional heteroskedasticity framework and enlist comprehensive equity market data. While modeling, we consider global, regional (Asia), and largest neighboring (India) equity markets as sources of information spillover. Our results show that equity returns in all these South Asian markets have positive autocorrelation. The equity markets of India, Pakistan, and Sri Lanka have some degree of global integration; however, their degree of regional integration is comparatively higher. The stock markets of Bangladesh and Nepal, in contrast, lack both global and regional integration. We find limited evidence of neighborhood (India) spillover effect on other markets in the sample. The stock markets of Bangladesh, India and Pakistan stock markets exhibit asymmetric volatility responses, while Nepal exhibits an inverted asymmetric volatility response, and in contrast Sri Lanka exhibits a symmetric volatility response to return shocks. Finally, most of these markets experience volatility spillover effects from the US, Asia, and India stock markets.

Building the connection between nation and commercial brand: an integrative review and future research directions

PurposeThis paper aims to provide an integrative review on nation branding literature and to identify new avenues for future research on embedding nation equity into commercial brands.Design/methodology/approachIntegrative review and analysis with conceptual development and future research directions.FindingsThe authors firstly identify conceptualizations and measurements of nation brand as national identity and as national image. Consistently, three theoretical perspectives investigating nation branding were given: first, the macro view focusing on nation brand broadly as political and cultural identity; second, the micro view focusing on nation brand as a country image; and finally, the integrative view using the emerging construct of nation equity. Inspired by the last theoretical view, the authors discuss four research foci that examine nation equity in commercial brands for future research.Originality/valueThe paper provides an integrative understanding of nation branding and identifies novel research opportunities to study this research field – building the connection between nations and commercial brands through nation equity.

Quantifying nation equity with sales data: A structural approach

Nation equity refers to a product's equity that is associated with its country of origin (COO). Generalized COO effects have previously been studied through experiments and surveys and measured by quality perception, product attitude, and purchase intention. We propose a structural equilibrium approach to assessing the additional market power COO offers, monetizing nation equity with product sales data, and computing the price premiums and discounts associated with nation equity. We apply this approach to China's personal computer market between 1995 and 2008 and find that COO does generate additional market power and affects firm markups. We find nation equity to be pervasive, significant, and multidimensional, and it evolves over time, but there is no simple correspondence between market share and nation equity. Large market shares do not necessarily mean positive nation equity and price premiums, negative nation equity and price discounts can evolve into positive nation equity and price premiums, and vice versa. We discuss the implications of our modeling approach and our findings for emerging markets in general, and for China in particular.

Quantifying Nation Equity with Sales Data: A Structural Approach

Nation equity refers to a product's equity that is associated with its country of origin (COO). Generalized COO effects have previously been studied through experiments and surveys and measured by quality perception, product attitude, and purchase intention. We propose a structural equilibrium approach to assessing the additional market power COO offers, monetizing nation equity with product sales data, and computing the price premiums and discounts associated with nation equity. We apply this approach to China's personal computer market between 1995 and 2008 and find that COO does generate additional market power and affects firm markups. We find nation equity to be pervasive, significant, and multidimensional, and it evolves over time, but there is no simple correspondence between market share and nation equity. Large market shares do not necessarily mean positive nation equity and price premiums, negative nation equity and price discounts can evolve into positive nation equity and price premiums, and vice versa. We discuss the implications of our modeling approach and our findings for emerging markets in general, and for China in particular.

The impact of terrorism on global equity market integration

In this paper we investigate the short-term contagion and long-term integration effects of terrorist activity on national stock markets. Using the partially integrated model of Bekaert et al. (Bekaert G, Harvey C and Ng A (2005) Market integration and contagion. Journal of Business 78: 39–69), we examine whether changes in cross-border relationships surrounding recent terrorist events are caused by changes in exposure to common risk factors and investigate whether these findings are similar across both developed and emerging market securities. Our research concludes that terrorism induces substantial contagion and market integration effects on national equity markets. Specifically, we provide strong evidence that major terrorist attacks induce substantial contagion consequences, particularly for developed nation equity markets. In terms of longer-term integration effects, a strong increase in cross-market correlation is observed from the pre to post-9/11 period. However, we find little evidence of an increase in the risk exposures of national markets to common risk factors, suggesting that this heightened correlation is driven by an increase in global risk factor uncertainty. This finding is consistent with the argument that an increase in the risk aversion of market participants is associated with terrorist attacks.

Nation Equity: Incidental Emotions in Country-of-Origin Effects

Different from past research on country‐of‐origin effects that has focused on cognitive factors, this article examines the impact of incidental emotions and cognitive appraisals associated with these emotions on country‐of‐origin effects. Experiment 1 compared anger and sadness and demonstrated that country of origin influenced evaluations only in the angry (vs. sad) condition where human (vs. situation) control was high. Experiment 2 further identified the effects of agency control using a different emotion, frustration. Based on these observations, this article suggests that, like brands, countries also have equity associated with them, termed “nation equity,” that has both performance and emotional components.

On the measurement of the nation's equity adjusted health.

The aim of this article is to show a method for measuring the nation's equity-adjusted health. In order to estimate what the 'nation's health function' looks like, data from a survey sent to a sample of Swedish politicians were used. The results from the survey can be interpreted as a measure of inequity aversion, and this was applied to data on healthy years (HY) for males in different social groups for the period 1975-1990. The mean of healthy years increased during the period 1986-1990 by 1.09% while equity adjusted healthy years (HY(EDE)) dropped by -1.78%. The nation's health has decreased in spite of the fact that the individual's health has increased.

Brunei Bids for International Tourism

The tiny sultanate of Brunei wishes to become a player in the international tourism industry in advance of the day when revenues from its oil exports decline. Like so many destinations that have yet to be developed, Brunei wishes to base its tourism industry on concepts of “nation equity,” which means improving its perception among would-be travelers, and ecotourism, to avoid the environmental degradation that often accompanies tourism development. Brunei thus wishes both to use and preserve the diverse ecosystem represented by its tropical rain forests. By promoting ecotourism Brunei will not only optimize land use and logistics capacity, but it will seek to maintain the rain forest's industrial and pharmacological resources and also reduce its current over-dependence on oil and gas exports.

Brunei bids for International tourism

The tiny sultanate of Brunei wishes to become a player in the international tourism industry in advance of the day when revenues from its oil exports decline. Like so many destinations that have yet to be developed, Brunei wishes to base its tourism industry on concepts of “nation equity,” which means improving its perception among would-be travelers, and ecotourism to avoid the environmental degradation that often accompanies tourism development. Brunei thus wishes both to use and preserve the diverse ecosystem represented by its tropical rain forests. By promoting ecotourism Brunei will not only optimize land use and logistics capacity, but it will seek to maintain the rain forest's industrial and pharmacological resources and also reduce its current over-dependence on oil and gas exports.

Perceptions of quality in the global market

Introduces the idea of nation equity via a world‐wide quality poll carried out by Bozell‐Gallup; assesses its international implications for the study of manufacturing quality. Outlines implications of the study for the United Kingdom. Highlights the importance of emerging East European markets for all exporters. States that nation equity is likely to play an increasingly pivotal role in product quality perception.