CONSUMER ETHNOCENTRISM IN SOUTH ASIA
Soumava Bandyopadhyay, Lamar University
Munir Muhammad, Lamar University
ABSTRACT
An empirical test to measure consumer ethnocentrism in two markets in South Asia, India
and Bangladesh, is reported. The well-known measure of ethnocentrism, the CETSCALE
(Shimp and Sharma 1987), is applied, its psychometric properties are examined, and the
effects of demographics on ethnocentrism are explored, in the Indian and Bangladeshi
contexts.
INTRODUCTION
Consumer ethnocentrism is defined (Shimp and Sharma 1987, p. 280) as "the beliefs held
by consumers about the appropriateness, indeed morality, of purchasing foreign-made
products." Consumers who are ethnocentric believe that purchasing imported products is
unpatriotic, causes loss of jobs, and hurts the domestic economy. Consumers who are
non-ethnocentric judge foreign products on their merits without consideration of where
these products are made.
The study of consumer ethnocentrism would be appropriate in a market where fierce
competition exists between domestic and foreign-made products. The emerging markets
India and Bangladesh in South Asia fit that description today. With 936 million and 128
million people, respectively (The World Almanac 1998), India and Bangladesh lead the
South Asian region in population. Even with low per capita GDPs (purchasing power
equivalent) of $1,300 and $1,100, respectively (The World Almanac 1998), India and
Bangladesh both have sizable middle class populations with considerable buying power.
The estimated size of the middle-class consumer market with a sustainable demand for
imported merchandise is about 150 million people in India (Kulkarni 1993), and about 25
million people in Bangladesh.
The current competition between domestic and imported consumer goods in India and
Bangladesh has evolved in contrasting ways. Both India and Bangladesh (then the eastern
part of Pakistan) emerged independent from British Colonial India in 1947. After
independence, the Indian economy followed socialistic economic policies and
emphasized self-reliance in the manufacturing sector, particularly for consumer goods
(Banks and Natarajan 1995). This resulted in severe tariffs and other restrictions on the
import of consumer products, and the subsequent growth of many domestic Indian
consumer goods manufacturers. Beginning in the early 1980s, the Indian government has
taken a series of steps to liberalize the economy and ease restrictions on imported goods
(Banks and Natarajan 1995). As a result, the Indian market today is flooded with
imported products from many countries, which compete with numerous traditional Indian
makes. With competition between foreign and domestic manufacturers of consumer
durables and nondurables intensifying, many Indian businesses as well as political
campaigns are now appealing to Indian consumers to support local manufacturers so that
Indian jobs are preserved and the economy remains healthy (Kulkarni 1993).
Pakistan, unlike India, chose to follow an import-oriented economy after independence.
East Pakistan, after seceding from its parent country and assuming the new name
'Bangladesh' in 1971, followed the same policy for several years. This resulted in serious
foreign trade deficits for Bangladesh, which stood at $1.4 billion, or 67% of the country's
exports, in 1996 (The World Almanac 1998). To correct this situation, public policy in
Bangladesh has been moving toward promoting growth of domestic industries for the
past several years (Clerk 1997). The consumers of Bangladesh are now being encouraged
more than ever to purchase domestically made products.
Against the backdrop described above, a measurement of consumer ethnocentrism among
the middle-class in India and Bangladesh should provide an idea of the extent to which
consumers in these two countries are likely to favor domestically-made products over
their foreign competitors. This paper describes such a measurement, where the wellknown scale for consumer ethnocentrism developed by Shimp and Sharma (1987), the
CETSCALE, is applied in the Indian and Bangladeshi environments. The relationship of
ethnocentrism with various demographic factors in the two countries is explored. A
comparison is also made between the levels of ethnocentrism in the two neighboring
countries.
BACKGROUND LITERATURE REVIEW
The sociological definition of ethnocentrism was offered by Sumner (1906, p. 13) as: "the
view of things in which one's own group is the center of everything, and all others are
scaled and related with reference to it ... Each group nourishes its own pride and vanity,
boasts itself superior, exalts in its own divinities and looks with contempt on outsiders."
In a marketing and consumer behavior sense, ethnocentrism refers to consumers'
preference for domestic products and prejudice against imports. Consumer ethnocentrism
results first from the love and concern for one's own country and the fear of losing
control of one's economic interests from the harmful effects of imports (Sharma, Shimp,
and Shin 1995). Consumers who are highly ethnocentric are unwilling to purchase
foreign products and tend to look at the issue of buying foreign goods as a moral rather
than just an economic problem.
The most well-known scale that measures consumers' ethnocentric tendencies is the
CETSCALE, developed by Shimp and Sharma (1987). The 17-item scale was rigorously
formulated, refined, and validated in the United States. Although originally developed as
a measure of American consumers' ethnocentric tendencies, the CETSCALE was
subsequently applied and its psychometric properties validated internationally, in Japan,
France, and Germany (Netemeyer, Durvasula, and Lichtenstein 1991), Korea (Sharma,
Shimp, and Shin 1995), Russia (Durvasula, Craig, and Netemeyer 1997), and China
(Klein, Ettenson, and Morris 1998). Our application of the CETSCALE in India and
Bangladesh adds to the measure's cross-cultural relevance.
Empirical studies in many countries, such as the United States (Shimp and Sharma 1987),
Canada (Hung 1989), France (Baumgartner and Jolibert 1977), the United Kingdom
(Bannister and Saunders 1978), and Korea (Sharma, Shimp, and Shin 1995) have
illustrated that consumers with ethnocentric tendencies have a proclivity to evaluate
domestic products favorably, often unreasonably so, compared to imported products. This
indicates a definite positive association between ethnocentrism and evaluation of
domestically-made products, and a negative association between ethnocentrism and
evaluation of imported products. Study of ethnocentric tendencies among consumers in a
country, therefore, has clear implications for marketers. If the level of consumer
ethnocentrism in a market is high, foreign manufacturers looking forward to expand in
that market as well as domestic marketers distributing imported products will face a
tough challenge.
RESEARCH DESIGN
The sampling frame for the study comprised students enrolled in graduate programs in
business administration and engineering at three premier institutions in India and two
premier institutions in Bangladesh. Surveying these students was deemed appropriate as
business and engineering graduates are considered to be the elite among professionals in
this part of the world. They usually command the highest salaries among all professional
occupations (Cox 1996; Saywell 1997). They are the cream of the emerging middle-class,
are more likely to afford expensive foreign products, and hence the target market for
most foreign manufacturers expanding into these two markets. The survey could be
conveniently administered in English without encountering any problems as English is
the medium of instruction for higher education and the language most commonly used in
business transactions in both India and Bangladesh.
The subjects in the sample were given a self-administered questionnaire that included
Shimp and Sharma's (1987) 17-item CETSCALE (with references to the United States in
the original scale replaced with reference to India or Bangladesh, as appropriate). The
individual scale items are listed in Table 1. The respondents were asked to indicate their
extent of agreement with various statements describing ethnocentric proclivities on a 7point Likert scale (1 = strongly disagree, 7 = strongly agree).
The survey was distributed among 150 graduate students in three premier institutions of
business administration and engineering in India and among 150 graduate students in two
similar institutions in Bangladesh. A total of 81 usable responses were received from
India, representing a response rate of 54 percent. The number of usable responses
obtained from Bangladesh was somewhat lower at 52, which corresponded to a response
rate of 34.7 percent. The samples, though small in size, compared reasonably with the
sample sizes of 73, 70, and 76 obtained for testing the CETSCALE in Germany, France,
and Japan, respectively (Netemeyer, Durvasula, and Lichtenstein 1991). Given the
pioneering and exploratory nature of the study, we considered the sample sizes adequate
for getting some initial glimpses into the nature of consumer ethnocentrism in India and
Bangladesh.
RESULTS
Respondent Characteristics
The average age of respondents was 25.3 years and 27.2 years in India and Bangladesh,
respectively. In both countries, the respondents were predominantly male. Sixty-eight of
the 81 respondents (84%) in India and 45 of the 52 respondents (86.5%) in Bangladesh
were male. This was not surprising, as males typically outnumber females in higher
education leading to professional degrees almost everywhere, more so in developing
countries. Sixty-six respondents in India (81.5%) had completed their Bachelor's degrees
and were working toward their Master's degrees. The remaining 15 respondents (18.5%)
had completed their Master's degrees. In Bangladesh, the proportion of respondents with
completed Master's degrees was higher at 57.7% (30 in all). The rest (22, or 42.3%) of
the Bangladeshi respondents were enrolled in Master's degree programs after completing
their Bachelor's degrees.
Ethnocentrism
The 17-item consumer ethnocentrism measure (CETSCALE) exhibited a high degree of
internal consistency in both countries, as evident from Cronbach's alpha reliability scores
of .9533 in India, and .9043 in Bangladesh, respectively. All individual scale items had
reasonably high item-to-total correlations (.615 and over in India, and .383 and over in
Bangladesh). A principal components analysis of the 17 items resulted in the emergence
of a single factor in both countries. In India, the emergent factor had an eigenvalue of
9.852 and explained 57.9% of the variation in the measure. In Bangladesh, the eigenvalue
of the single factor was 6.872 and the factor accounted for 40.42% of the variation. The
relatively lower (but acceptable) scores in Banaladesh could be attributed to the
comparatively smaller sample size in that country (52 versus 81 in India). The reliability
and unidimensionality of the CETSCALE were thus demonstrated in the Indian and
Bangladeshi environments. The item-to-total correlations and the factor loadings for the
17 items are shown in Table 1.
The overall mean score of ethnocentrism was obtained as the average of the scores on the
17 component items. The mean ethnocentrism score in India was found to be 2.98 (with a
standard deviation of 1.36), whereas that in Bangladesh was found to be greater at 4.38
(with a standard deviation of 1.25). A t-test on the two means showed that consumer
ethnocentrism was significantly higher in Bangladesh than in India (t = 6.09, p < .001).
Ethnocentrism and Demographics
Researchers have previously examined the effect of demographic variables such as age,
gender, education, income level, and foreign travel on consumer ethnocentrism (Sharma,
Shimp, and Shin 1995; Wall, Liefield, and Heslop 1989). Older people are more likely to
exhibit higher levels of ethnocentrism, as they tend to be more conservative (Bannister
and Saunders 1978; Han 1988). Studies in the United States (Howard 1989) and Canada
(Wall and Heslop 1986) have shown that women rate domestic products more favorably
than men. More educated people are less likely to have ethnic prejudices (Watson and
Johnson 1972), tend to be less conservative (Ray 1983), and are more likely to have
positive attitudes toward imported products (Wall and Heslop 1986; Wang 1978). People
who travel abroad tend to exhibit lower levels of ethnocentrism (Wall, Liefield, and
Heslop 1989) as foreign travel is likely to result in more cultural exchanges and
broadening of minds. Also, high-income consumers are generally found to react more
favorably toward foreign products (Wall and Heslop 1986; Wang 1978). In our study, the
respondents were not asked about their incomes because, being students at premier
institutions, they were looking forward to earning good salaries upon graduation rather
than currently having a high level of income. Based on the preceding discussion, the
following hypotheses relating Indian and Bangladeshi consumers' ethnocentrism and
demographic factors were tested:
H1: Consumer ethnocentrism in India and Bangladesh is positively related
to age.
H2: Women consumers in India and Bangladesh exhibit a higher degree
of ethnocentrism than men.
H3: Consumer ethnocentrism in India and Bangladesh is negatively
related to the level of education.
H4: Consumers who have traveled abroad exhibit a lower level of
ethnocentrism than consumers who have not in India and Bangladesh.
Hypothesis H1 was tested by correlating the ethnocentrism scores with the respondents'
ages. The Pearson correlation coefficient between ethnocentrism and age was found to be
-.031 in India, and -.067 in Bangladesh, both correlations being statistically
nonsignificant. Hypothesis 1 was, therefore, not supported.
Hypotheses H2, H3, and H4 were tested by means of t-tests. The results are shown in
Table 2. For H2, the mean scores for ethnocentrism were compared between men and
women. Table 3 shows that women did score higher than men on ethnocentrism (mean
score 3.67 for women versus 2.85 for men, t = 2.04, p < .05) in India. There was no
significant difference found, however, between men and women in Bangladesh (mean
score 4.47 for women versus 4.36 for men, t = .18, p = .86). Therefore, H2 was supported
in India, but not in Bangladesh.
For testing H3, the mean scores for ethnocentrism were compared between respondents
who had completed bachelor's degrees and those who had completed master's degrees. In
India, the mean ethnocentrism score for people with master's degrees (2.36) was
significantly less (t = 2.81, p < .05) than that for respondents with bachelor's degrees.
Thus, the degree of relationslism was negatively related to the level of educational
achievement in India. There was no statistical difference found in the ethnocentrism
scores for people with or without master's degrees in Bangladesh (t = .78, p = .44).
Therefore, support for H3 was available in India, but not in Bangladesh.
Hypothesis H4 was tested by comparing the mean ethnocentrism score of respondents
who indicated that they had traveled abroad and those who indicated that they had not. As
shown in Table 3, foreign travel did not relate to any significant difference in
ethnocentrism (t = 1.65, p = 10) at the p < .05 level or better among Indian respondents.
In Bangladesh, however, people who had traveled abroad exhibited a level of
ethnocentrism (4.07) that was significantly lower (t = 2.86, p < .05) than that (5.02) of
people who had no experience of foreign travel. Therefore, H4 was supported only in
Bangladesh.
DISCUSSION
The significantly higher level of ethnocentrism in Bangladeshi consumers (compared to
their Indian counterparts) might be attributed to the history of availability of imported
consumer products in the two countries. After having little access to foreign-made
consumer products for several decades of state policy promoting self-reliance,
increasingly affluent Indian consumers today are rushing to buy imported products from a
liberalized domestic market (Jain, Raval, and Mehra 1997; Chandrasekaran and Ryans
1996). In a recent survey, 37 of the top 62 brands in India were found to be foreignowned (Kohli 1996). This likely explains the low ethnocentrism score (2.98) in the Indian
sample. In contrast to India, Bangladesh did not seek to develop its own manufacturing
industries for a long time, and consumers there almost always turned to imported goods
to fulfill their needs. Increasing unemployment and balance of trade deficits are now
forcing public policy makers in Bangladesh to focus more on developing domestic
industries and moving away from the primarily agrarian nature of the economy. The
relatively high ethnocentrism (4.38) in the Bangladeshi sample is probably a reflection of
the increasing "buy domestic" sentiment being promoted among consumers in that
country.
No significant correlation was found between ethnocentrism and age in either sample. A
possible reason may be the fact that the ranges of respondents' ages were too narrow in
both samples (21-35 in India, and 22-37 in Bangladesh) for age-related differences in
ethnocentrism to be pronounced. Incidentally, the expected relationship between age and
ethnocentrism was not supported in a previous study in Korea (Sharma, Shimp and Shin
1995) either.
Ethnocentrism was found to vary with gender and educational level in India, but not in
Bangladesh. Perhaps the relatively high degree of ethnocentrism found in Bangladesh
was a popular, contemporary feeling among consumers there that eclipsed the effect of
demographic differences. The only factor that made a difference in Bangladesh was
foreign travel. Bangladeshis who had traveled abroad (and therefore, were expected to
have a greater exposure to and appreciation for foreign countries and cultures) seemed to
rise above the popular feelings somewhat, and exhibited a significantly lower level of
ethnocentrism that people who had not. In India, ethnocentrism was not significantly
reduced with foreign travel (even though one could argue in favor of a very weak
statistical difference in the t-test, with p = .10), which likely meant that ethnocentrism
among Indian consumers was too low to begin with to be further influenced by the
experience of foreign travel.
CONCLUSION
This study provides some initial glimpses into the nature of consumer ethnocentrism in
the two populous South Asian markets of India and Bangladesh. Though the study may
be considered to provide some useful directions in analyzing consumer ethnocentrism in
the two countries, its limitations must also be acknowledged. The study is exploratory in
nature, with small sample sizes. Some of the sub-samples used in testing the hypotheses
were indeed very small (for example, there were only 7 females in the Bangladeshi
sample); so the results must be interpreted with caution. Future studies must be more
rigorous in this regard. Other factors that might possibly influence ethnocentrism, such as
income, employment, perceived threat from foreign competition (Shimp and Sharma
1987), etc., should be explored in future studies. International marketers will look more
toward the emerging South Asian market in the future. An investigation of consumer
ethnocentrism and its possible causes will definitely help them build sound marketing
strategies.
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TABLE 1
Reliability and Unidimensionality of the CETSCALE in India and Bangladesh
INDIA
BANGLADESH
Item-tototal
Correlations
Factor
Loadings
Item-tototal
Correlations
Factor
Loadings
1.__ people should always buy
__ made products instead of
imports.
.615
.656
.549
.616
2. Only those products that are
unavailable in __ should be
imported.
.717
.751
.391
.454
3. Buy __ made products. Keep __
working.
.767
.795
.468
.524
4. __ products first, last, and
foremost.
.782
.812
.654
.705
5. Purchasing foreign-made
products is un-__.
.660
.705
.450
.527
6. It is not right to purchase foreign
products.
.772
.804
.644
.711
7. A real __ should always buy __
made products.
.799
.833
.756
.803
8. We should purchase products
made in __ instead of letting other
countries get rich off us.
.760
.795
.612
.677
Item *
Table 1 Cont.
9. It is always best to purchase __ products.
.652
.690
.656
.714
10. There should be very little trading or purchasing
of goods from other countries unless out of
necessity.
.737
.770
.490
.540
11. __ should not buy foreign products because this
hurts __ businesses and causes unemployment.
.676
.712
.607
.672
12. Curbs should be put on all imports.
.701
.745
.555
.620
13. It may cost me in the long run, but I prefer to
support __ products.
.779
.809
.325
.380
14. Foreigners should not be allowed to put their
products in markets.
.743
.780
.655
.710
15. Foreign products should be taxed heavily to
reduce their entry into __.
.642
.684
.703
.760
16. We should buy from foreign countries only those
products that we cannot obtain in our own country.
.736
.770
.383
.441
17. __ consumers who purchase products made in
other countries put their fellow ___s out of work.
.770
.803
.708
.755
Cronbach's Alpha measure of scale reliability
.9533
.9043
Eigenvalue of single emergent factor
9.852
6.872
Variance explained
57.91%
40.42%
* Fill in '___' with 'India/Indian' or 'Bangladesh/Bangladeshi' as appropriate
TABLE 2
Tests of Hypotheses
H2: Ethnocentrism and Gender
Women
INDIA:
BANGLADESH:
Men
t-value p-value
N
13
Ethnocentrism
3.67
Standard Deviation 1.33
68
2.85
1.32
2.04
p < .05
N
7
Ethnocentrism
4.47
Standard Deviation 1.49
45
4.36
1.23
.18
p = .86
H3: Ethnocentrism and Educational Level
Bachelors Masters
Degree
Degree
INDIA:
BANGLADESH:
t-value p-value
N
66
Ethnocentrism
3.13
Standard Deviation 1.42
15
2.36
.82
2.81
p < .05
N
22
Ethnocentrism
4.22
Standard Deviation 1.10
30
4.49
1.36
.78
p = .44
H4: Ethnocentrism and Foreign Travel
Traveled
Abroad
Did Not
t-value p-value
Travel
INDIA:
N
35
Ethnocentrism
2.72
Standard Deviation 1.03
46
3.19
1.54
1.65
p = .10
BANGLADESH:
N
35
Ethnocentrism
4.07
Standard Deviation 1.23
17
5.02
1.07
2.86
p < .05