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Understanding the relationship between advertising spending and happiness at the country level

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Abstract

Concerns have been raised as to the potentially deleterious effects of advertising on society. We examine this issue given the recent calls to explore the societal effects of international business activities, the substantive nature of advertising spending globally, and the movement by governments to hold businesses accountable for societal harms. We build upon the general theory of competitive rationality, suggesting a positive relationship between advertising spending and happiness at the country level. We integrate an institutional economics framework into the general theory of competitive rationality to understand country effects. We explore whether institutional environments (i.e., political, regulatory, and social) are associated with happiness and/or moderate the relationship between advertising spending and happiness. We empirically examine these relationships using a 34-country, 9-year unbalanced panel dataset. Our findings indicate that advertising spending at the country level is positively associated with happiness, even when accounting for country-level institutional direct and moderating effects. We discuss our results in comparison to prior findings, highlighting implications for international marketing theory and practice, and setting forth a foundation for debate and research in the field.

Résumé

Des inquiétudes ont été soulevées quant aux effets potentiellement délétères de la publicité sur la société. Nous examinons cette question compte tenu des récents appels à explorer les impacts sociétaux des activités commerciales internationales, la nature substantielle des dépenses publicitaires à l'échelle mondiale et le mouvement des gouvernements visant à tenir les entreprises responsables des dommages sociétaux. Nous appuyons sur la théorie générale de la rationalité concurrentielle, nous proposons une relation positive entre les dépenses publicitaires et le bonheur au niveau national. Nous intégrons un cadre d'économie institutionnelle dans la théorie générale de la rationalité concurrentielle afin de comprendre les impacts du pays. Nous explorons si les environnements institutionnels (c'est-à-dire juridiques, réglementaires et sociaux) sont associés au bonheur et/ou modèrent la relation entre les dépenses publicitaires et ce dernier. Nous examinons empiriquement ces relations à l'aide d'un ensemble de données de panel déséquilibré de 34 pays sur une période de neuf ans. Nos résultats indiquent que les dépenses publicitaires au niveau national sont positivement associées au bonheur au niveau national, même en tenant compte des impacts institutionnels modérateurs et directs au niveau national. Nous discutons nos résultats par rapport aux résultats antérieurs tout en mettant en lumière les implications pour la théorie et la pratique du marketing international et en établissant une base pour le débat et la recherche dans le domaine.

Resumen

Se ha suscitado la inquietud por los efectos potencialmente nocivos de la publicidad en la sociedad. Examinamos esta cuestión teniendo en cuenta los recientes llamados a explorar los efectos en la sociedad de las actividades de negocios internacionales, la naturaleza sustantiva del gasto publicitario en todo el mundo y el movimiento de los gobiernos para responsabilizar a las empresas de los daños sociales. Nos basamos en la teoría general de la racionalidad competitiva, que sugiere una relación positiva entre el gasto en publicidad y la felicidad a nivel de país. Integramos un marco de economía institucional en la teoría general de la racionalidad competitiva para entender los efectos de los países. Exploramos si los entornos institucionales (es decir, legales, regulatorios y sociales) están asociados a la felicidad y/o moderan la relación entre el gasto publicitario y la felicidad. Examinamos empíricamente estas relaciones utilizando un conjunto de datos de panel desequilibrado de 34 países durante nueve años. Nuestros resultados indican que el gasto en publicidad a nivel de país se asocia positivamente con la felicidad a nivel de país, incluso cuando se tienen en cuenta los efectos institucionales directos y moderadores a nivel de país. Los resultados se comparan con los anteriores, destacando las implicaciones para la teoría y la práctica del marketing internacional y sentando las bases para el debate y la investigación en este campo.

Resumo

Preocupações surgiram quanto aos efeitos potencialmente prejudiciais da publicidade na sociedade. Examinamos essa questão a luz de recentes apelos para explorar os efeitos sociais de atividades de negócios internacionais, a natureza substantiva de gastos com publicidade globalmente e o movimento de governos para responsabilizar as empresas por danos sociais. Baseamo-nos na teoria geral da racionalidade competitiva, sugerindo uma relação positiva entre gastos com publicidade e felicidade em nível de país. Integramos um modelo de economia institucional na teoria geral de racionalidade competitiva para entender efeitos do país. Exploramos se ambientes institucionais (ou seja, legal, regulatório e social) estão associados com felicidade e/ou moderam a relação entre gastos com publicidade e felicidade. Examinamos empiricamente essas relações usando um conjunto de dados em painel não balanceado de 34 países e nove anos. Nossas descobertas indicam que gastos com publicidade no nível do país estão positivamente associados com felicidade no nível do país, mesmo quando consideramos efeitos institucionais diretos e moderadores no nível do país. Discutimos nossos resultados em comparação com descobertas anteriores, destacando implicações para teoria e prática de marketing internacional e estabelecendo uma base para o debate e a pesquisa na área.

摘要

广告对社会的潜在的有害影响让人们提出了担忧。我们研究了这个问题是鉴于最近呼吁探索国际商务活动的社会影响, 全球广告支出的实质性质, 以及政府要求企业对社会危害负责的运动. 我们以竞争理性的通用理论为基础, 提出了国家层面的广告支出与幸福感之间存在正相关关系. 我们将制度经济学框架整合到竞争理性的通用理论中来理解国家效应. 我们探讨了制度环境 (即法律, 监管和社会) 是否与幸福相关和/或调节广告支出与幸福之间的关系. 我们使用 34 个国家的 9 年不平衡面板数据集对这些关系进行了实证检验. 我们的研究结果表明, 国家层面的广告支出与国家层面的幸福感呈正相关, 即使考虑到国家层面制度直接的和调节的效应也是如此. 我们将我们的研究结果与先前的发现进行了比较, 强调了对国际营销理论和实践的启示, 并为该领域的辩论和研究奠定了基础.

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Acknowledgments

The names of authors are listed alphabetically and contributed equally to the research. The authors are extremely grateful to the area editor and the three anonymous reviewers for their constructive and supportive comments throughout the review process.

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Correspondence to David A. Griffith.

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Accepted by Constantine Katsikeas, Area Editor, 16 January 2022. This article has been with the authors for three revisions.

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Griffith, D.A., Lee, H.S. & Yalcinkaya, G. Understanding the relationship between advertising spending and happiness at the country level. J Int Bus Stud 54, 128–150 (2023). https://doi.org/10.1057/s41267-022-00510-0

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