Would you buy a techno toy for your child from China? Would you drink Bacardi rum if you could buy Havana Club? When you buy olive oil, do you choose the Italian brand or an alternative from Portugal?
In international trade, individual brands are not independent. Their success depends on the reputation of their country of origin. Citgo stations sell high-quality petroleum products at competitive prices, but many Americans refuse to buy them because the company is controlled by Venezuela. Even now, after 17 years of relative stability, many Americans are afraid to vacation in Nicaragua's peaceful, beautiful beach resorts because they associate this country with war. More
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