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International trade in 'quality goods': signalling problems for developing countries

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  • John Hudson

    (Department of Economics and International Development, University of Bath, Bath, UK)

  • Philip Jones

    (Department of Economics and International Development, University of Bath, Bath, UK)

Abstract

Consumers evaluate product quality with information signals such as brand name giving an advantage to established firms over other firms even when introducing a new product. Another signal is 'country of origin' and, as high-income countries focus more heavily on higher quality goods, there is a tendency for consumers to associate quality with a country's income per capita. Thus new firms from developing countries face particular problems in export markets. International standardization offers a potential solution to their problem. However, analysis of the use of ISO 9000 suggests that it is difficult to eliminate the informational asymmetry. Copyright © 2003 John Wiley & Sons, Ltd.

Suggested Citation

  • John Hudson & Philip Jones, 2003. "International trade in 'quality goods': signalling problems for developing countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(8), pages 999-1013.
    • Handle: RePEc:wly:jintdv:v:15:y:2003:i:8:p:999-1013
    DOI: 10.1002/jid.1029
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