Effects of National Culture on the Extent of Panic Buying during the COVID-19 Outbreak

Abstract

The COVID-19 outbreak and its declaration as a pandemic by the WHO on March 11, 2020 resulted in consumer panic buying across the globe. Extant research into panic buying is scant, and its cultural context practically unexplored. This article uses mobility change data provided by Google and draws on reactance theory to establish how perceived scarcity limits freedoms, and ultimately drives individuals to panic buying. It hypothesizes and analyzes the influence of cultural factors; the findings show that individualism and uncertainty avoidance both exert a positive effect on the extent of panic buying, whereas power distance has a negative effect.

Keywords:

• COVID-19
• pandemic
• panic buying
• reactance theory
• scarcity effects
• stockpiling

Notes

1 Even though panic buying was sometimes referred to as hoarding during the COVID-19 pandemic, they are distinct behaviors. Hoarding is an extreme and persistent accumulation of (sometimes worthless) possessions, that are rather difficult to discard later (DSM-5 2013). Conversely, panic buying is a more goal-directed activity (Taylor 2021).

2 Subsequently, Hofstede proposed long-term orientation and indulgence/constraint as additional cultural dimensions (Hofstede and Hofstede 2005; Hofstede, Hofstede, and Minkov 2010). However, the data for these dimensions do not always cover the same countries as those for the four original dimensions. We are fully aware about numerous concerns regarding the Hofstede dimensions, including that (1) the work is based on employee data from only one multinational company; (2) the dimensions are too general, and may omit other focal values; (3) the scores are outdated because they are based on data collected between 1967-1973; and (4) the methodology for calculating the scores is questionable. Notwithstanding, Hofstede’s dimensions have come to dominate the international business literature and we believe them to be adequate for our analysis.

3 The category grocery & pharmacy includes grocery markets, food warehouses, farmers markets, specialty food shops, drug stores, and pharmacies (Google LLC 2020).

Additional information

Funding

The authors gratefully acknowledge support from the Darla Moore School of Business and the Center for International Business Education and Research (CIBER) at the University of South Carolina.