The culture-promotion effect of multinationals on trade
The Ikea case
Bibliographic Data
| ID | 12694567 |
|---|---|
| Authors | Dylan Bourny (LEO, University of Orléans , 45067 Orléans, France, corresponding author), Daniel Mirza (0000-0002-0685-2939, LEO, University of Tours, 37200 Tours , France and CEPII 75007 Paris, France), Camelia Turcu (0000-0002-5403-5829, LEO, University of Orléans , 45067 Orléans, France) |
| Year | 2023 |
| Volume | 23 |
| Issue | 4 |
| Pages | 771-800 |
| Publication date | 2023-01-09 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Journal of Economic Geography (JOURNAL) |
| Journal identifiers | ISSN: 1468-2702 • E-ISSN: 1468-2710 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1093/jeg/lbac033 |
| OpenAlex | W3139222757 |
| Language | EN |
| References cited | 18 |
In this article, we investigate how some MNEs which spread their home culture over time and space to the rest of the world are affecting, in turn, trade flows from home. By selling products embodying cultural information related to their country of origin, those MNEs embrace the role of ambassadors of their home country. We argue that IKEA offers an ideal case to identify a multinational’s culture-promotion effect on trade. We build a dataset on IKEA’s presence in foreign markets between 1995 and 2015 and merge it with disaggregated product level trade between pairs of countries. We find solid evidence of an externality linked to IKEA: a setting of an IKEA new store in a destination increases trade flows by around 2% from Sweden for products that resemble to what the multinational offers (despite being completely unrelated to that multinational). This result is driven primarily by the products identified to encompass a high-cultural content. Other robustness checks and tests seem to be very much consistent with the hypothesis of IKEA promoting the Swedish culture to the world
Business · Economic geography · Economics · International trade · Merge (version control · Multinational corporation · Political science · Promotion (chess · Global Trade and Competitiveness · Global trade and economics · International Business and FDI
| Highly cited | No |
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