Advertising Expenditures in the Developing World
- PDF / 340,178 Bytes
- 16 Pages / 540 x 777 pts Page_size
- 56 Downloads / 240 Views
64
*Nathaniel H. Leff is Professor of Business Economics and International Business at the Columbia UniversityGraduate School of Business. He holds degrees from Harvard,Columbia, and M.I.T.Professor Leff has published books and articles in the fields of economic development and international investment. **John U. Farley is a Professor at the Graduate School of Business at Columbia University and a member of the Faculty of InternationalAffairs. He is section Editorfor International Marketingof the Journal of Marketingand has published widely in marketing, and in the management and behavioral sciences. The authors are grateful to the Faculty Research Programof the Columbia Business School for financial support; to Della Sue and Srinivas Reddy for research assistance; and to Jean Boddewyn, John Conner, David Felix, and Louis Wells for helpful comments on an earlier draft. The authors take sole responsibility for any errors.
Palgrave Macmillan Journals is collaborating with JSTOR to digitize, preserve, and extend access to Journal of International Business Studies ® www.jstor.org
tising and increasing market demand involve social waste. In addition, advertising is often viewed as disrupting local cultures and subverting them with the products of alien lifestyles. Finally, although the promotional outlays of local and of foreign firms in LDCs are generally similar in percentage terms,3 advertising has often been perceived as a tool for penetration by multinational corporations in product markets and by multinational advertising agencies as well.4 Such concerns have made advertising a subject of general interest in many LDCs. Accordingly, this paper presents both a conceptual frameworkfor discussing the magnitude of advertising expenditures in the developing countries and empirical data on advertising intensity in a sample of more developed and less developed countries. (Following common usage and subject to well-known limitations, less developed countries are usually defined basically as countries with low levels of per capita income.) A statistical analysis of advertising expenditure levels focusses on this international cross-section of more developed and less developed countries; hence the analytical conclusions can be applied to countries at different levels of per capita income. It is firmly established that advertising expenditures are lower in developing countries than in the economically more advanced countries. This generalization holds in terms of both per capita advertising expenditure and advertising as a percentage of Gross National Product.5 Information of the sort just cited, however, may obscure some more fundamental relations concerning the magnitudes of advertising expenditures in the developing world. These have to do with the basic issue of whether, relative to the size of the local market, advertising expenditures might be expected to be larger or smaller in the LDCs as compared with the more developed countries. A prioriviews on this issue may go in either direction, so it is helpful to present
Data Loading...
