Country Image Effects in the Era of Protectionism

Abstract

The research presented in this article examines the effects of protectionist measures on the perceptions that consumers of a targeted country form of the country having adopted these measures as well of other countries not directly involved in the conflict. An experiment was conducted in which 148 Canadian adult consumers were informed that Germany had announced its decision to impose import tariffs on Canadian products. Two types of protectionist measures were considered, either initiated by Germany (i.e., proactive context) or as a response to similar measures adopted by Canada (i.e., reactive context). Consumers’ perceptions concerned the quality of products made in Germany, its image as a travel destination, and as a place to live. These perceptions were also obtained for three European countries differing with respect to their psychic distance with Germany; Austria (shortest distance), France (medium distance), and Spain (greatest distance). The results show that consumers’ perceptions depend on the type of protectionist measures adopted (proactive versus reactive), primarily among consumers interested in international economic news. Reactive protectionist measures were perceived as more legitimate than proactive measures and, in turn, legitimacy had a negative effect on the degree to which consumers developed situational political animosity toward Germany and, consequently, more negative country perceptions. These results were shown to spill over other countries as a function of their psychic distance with Germany. Implications for firms involved in global trading and for governments are derived from these results.

Keywords:

• Country distance
• country image
• protectionism
• spillover effects