Influence of exchange rate on cross-border shopping of Bruneians in Malaysia
Saiful Islam & Nurul Faizah Salleh & Siti Nooraini Sabli
One of the effects of exchange rate fluctuations is cross-border shopping by consumers. This paper provides an empirical analysis of the effects of Malaysian ringgit depreciation on cross-border shopping of Bruneians. This has been done by using daily data from 1 January 2014 to 31 December 2016 (total 1,096 observations) on traffic flows to Miri, a border town of Eastern Malaysia. We find that a 1 percent increase in the depreciation of Malaysian ringgit per Brunei dollar increases the number of Bruneian shoppers to Miri by 2.10 percent. We also estimated that the average spending per person per trip to Miri is B$155 and the total spending of Bruneian shoppers in Miri is $175 million a year. This total spending is 1.11 percent of gross domestic product of Brunei in 2016. The result from this study would be helpful in designing policies for cross-border shopping of Bruneians. This is because the number of visits and the total expenditure amount of Bruneians in Miri are related to high outflow of money which results in a loss to the local economy – which may deteriorate local business.
Cross-border shopping; Exchange rate; Bruneian shoppers; Miri Malaysia.
2019, Journal of Asian Business and Economic Studies
The government struggles to fight escalating food safety issues in Vietnam. However, government measures yielded little evidence of improvement to domestic food safety. For that reason, consumers lower their trust in the government. The current market context, and low trust towards the government left consumers to count on their own judgement for the sake of their own food safety. This study applied choice experiment method on the basis of Lancastrain consumer theory and random utility theory to elicit consumers preferences on traceable safe foods and the perception regarding food safety. The impact of food safety related attributes was identified in the order of decreasing magnitude: freshness, label, traceability, certification, and price. Results suggested that Vietnamese consumers adhered food quality to food appearance (i.e. freshness) and made judgement with such perception. This paper also highlighted a noticeable reverse impact of the level of food certification on consumer preferences toward safe choices, which contributed to the current food safety situation in Vietnam. The reason behind was expected to be trust issues in the government, the impact of food safety context, and consumer’s false perception of food safety. To enhance trust, food traceability appears to be an indispensable and potential instrument. Besides, traceability information should be addressed via food label precisely to augment visual inspection as well as to increase its effectiveness. Additionally, consumers are willing to pay a price premium for traceable products, thus would induce suppliers to participate in food traceability. Nevertheless, the government must play a more proactive role in market supervision and education to facilitate the development of food traceability.