Donald Lehmann

Cross-National 'Laws' and Differences in Market Response

Coauthor(s): John Farley.

Abstract:
International differences in general, and cultural differences in particular, exert profound influence on what people buy. In modeling market response, highly visible international differences in purchase behavior seem to lead to an assumption by management scientists that there are large parallel international differences in market response to such things as price and advertising. In an interpretive review of market response models, we do find international differences in response parameters, but we also find that parameter differences due to cross-national factors tend to be smaller than differences related to technical characteristics of the model or to product/market specifics. We suggest two new intermediate categories of generalizability between the extremes of "everything is the same" and "everything is different." We also argue that one promising approach to international generalization is through appropriate statistical adjustment of parameters from existing models.

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