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Home-Bias-in-Consumption Based on Different Brand Preferences in the East and the West of Germany

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  • Michael Bahles

Abstract

In international macroeconomics, there is a specific concept explaining deviations in international trade relations showing that countries have a bias and a strong preference for the consumption of their home-country goods. This article presents an application of the concept on brand preferences in West and East Germany, where a home-bias-in-consumption has been observed for the East of Germany. It is the first application of the concept on the territory of brand preference that explains the strong rootedness of the Eastern German consumers to their regionally known and familiar brands. The goal of the article is to elaborate more deeply the differences in attitudes towards brands between Eastern and Western German consumers. The main research method is secondary analysis of the data collected in two large research studies: (1) "West-East brand study", and (2) "Consumer Analysis". The results of the presented study have interesting managerial implications in brand management, showing that brands should utilize their local rootedness.

Suggested Citation

  • Michael Bahles, 2014. "Home-Bias-in-Consumption Based on Different Brand Preferences in the East and the West of Germany," Central European Business Review, Prague University of Economics and Business, vol. 2014(1), pages 7-12.
    • Handle: RePEc:prg:jnlcbr:v:2014:y:2014:i:1:id:69:p:7-12
    DOI: 10.18267/j.cebr.69
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    References listed on IDEAS

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    1. Narcissa Balta & Juan Delgado, 2009. "Home Bias and Market Integration in the EU," CESifo Economic Studies, CESifo Group, vol. 55(1), pages 110-144, March.
    2. Maurice Obstfeld & Kenneth Rogoff, 2001. "The Six Major Puzzles in International Macroeconomics: Is There a Common Cause?," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 339-412, National Bureau of Economic Research, Inc.
    3. Aurélie Kessous & Elyette Roux, 2010. "Brands Considered as “Nostalgic”: Consequences on Attitudes and Consumer-brand Relationships," Post-Print hal-01828627, HAL.
    4. Veenis, Milena, 2011. "Cola in the German Democratic Republic. East German Fantasies on Western Consumption," Enterprise & Society, Cambridge University Press, vol. 12(3), pages 489-524, September.
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    Cited by:

    1. Alexander Osharin & Valery Verbus, 2018. "Heterogeneity of consumer preferences and trade patterns in a monopolistically competitive setting," Journal of Economics, Springer, vol. 125(3), pages 211-237, November.

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    More about this item

    Keywords

    Home-bias-in-consumption; local brand preference; brand heritage and nostalgia;
    All these keywords.

    JEL classification:

    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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