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Collective reputation in trade : evidence from the Chinese dairy industry

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Bai, Jie, Gazze, Ludovica and Wang, Yukun (2021) Collective reputation in trade : evidence from the Chinese dairy industry. Review of Economics and Statistics . doi:10.1162/rest_a_01032 (In Press)

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Official URL: https://doi.org/10.1162/rest_a_01032

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Abstract

The existence of collective reputation implies an important externality. Among firms trading internationally, quality shocks about one firms products could affect the demand of other firms from the same origin country. We study such reputation spillover in the context of a large-scale scandal that affected the Chinese dairy industry in 2008. Leveraging detailed firm-product level administrative data and official quality inspection reports, we document sizable reputation spillovers on uncontaminated firms. We further investigate potential mechanisms that could mediate the strength of collective reputation, including information accuracy, observability of the supply chain and prior export experience.

Item Type: Journal Article
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH): Reputation -- Economic aspects -- China -- Econometric models, Dairy products industry -- Economic aspects -- China -- Econometric models, Exports -- China -- Psychological aspects -- Econometric models, Scandals -- Economic aspects -- Econometric models, Reputation -- Economic aspects -- Econometric models
Journal or Publication Title: Review of Economics and Statistics
Publisher: MIT Press
ISSN: 0034-6535
Official Date: 2021
Dates:
DateEvent
2021Published
17 March 2021Available
10 December 2020Accepted
DOI: 10.1162/rest_a_01032
Status: Peer Reviewed
Publication Status: In Press
Publisher Statement: This is the author’s final version, and that the article has been accepted for publication in Review of Economics and Statistics
Access rights to Published version: Restricted or Subscription Access
Copyright Holders: © 2021 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology
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