A Quantitative Experiment of the Effects of Transnational Crises on Corporate and Country Reputation and Strategic Responses

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Title:
A Quantitative Experiment of the Effects of Transnational Crises on Corporate and Country Reputation and Strategic Responses
Physical Description:
1 online resource (190 p.)
Language:
english
Creator:
Lim, Hyun-Ji
Publisher:
University of Florida
Place of Publication:
Gainesville, Fla.
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Thesis/Dissertation Information

Degree:
Doctorate ( Ph.D.)
Degree Grantor:
University of Florida
Degree Disciplines:
Mass Communication, Journalism and Communications
Committee Chair:
Molleda, Juan Carlos
Committee Members:
Kiousis, Spiro K
Weigold, Michael F
Kraft, John

Subjects

Subjects / Keywords:
country -- crisis -- image -- international -- public -- relations -- repair -- reputation
Journalism and Communications -- Dissertations, Academic -- UF
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Mass Communication thesis, Ph.D.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract:
This study analyzes the potential effects of a transnational corporate crisis on corporate and country reputation and explores how the image restoration strategy used by a corporation’s country of origin during a crisis in terms of managing its reputation will influence the attitude and behavioral intentions of people in other countries. Most previous research studies focus on the strategic responses of corporations during crises. Through the employment of a 2x2x3 factorial experiment, this study attempts to examine how three factors, level of country reputation, country-of-origin salience, and types of image restoration strategy, can affect host customers’ attitudes toward the transnational corporation and its country of origin and provoke changes in its intended behavior. Results indicate that there was no three-way interaction effect or two-way interaction effects among the level of country reputation, country-of-origin salience, or types of image restoration strategies. The results of the study reveal the importance of maintaining a good reputation in reference to a country’s industry and economy, as a transnational crisis caused by an MNC affects not only the company’s reputation and product sales, but it also influences host customers’ attitudes and purchase intentions toward the general products of the home country. In this study, country-of-origin salience was not a factor influencing host customers’ attitudes and behavioral intentions. The findings of this study suggests that employing a corrective action strategy is recommended for managing the reputations of both the multinational corporation facing the crisis and its home country for the long-term perspective, even though using denial strategy on behalf of the home country revealed host publics’ higher purchase intentions toward the company’s products. This study provides empirical evidence regarding whether adopting an image restoration strategy helps a country to recover its reputation during a crisis and creates an opportunity to gain a better understanding of how multinational corporations are influenced by the reputations of their countries of origin. It also contributes to the development of public relations research by adding to the literature on the interaction of country and corporate reputations and provides empirical evidence of strategic responses employed by various countries.
General Note:
In the series University of Florida Digital Collections.
General Note:
Includes vita.
Bibliography:
Includes bibliographical references.
Source of Description:
Description based on online resource; title from PDF title page.
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This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility:
by Hyun-Ji Lim.
Thesis:
Thesis (Ph.D.)--University of Florida, 2012.
Local:
Adviser: Molleda, Juan Carlos.
Electronic Access:
RESTRICTED TO UF STUDENTS, STAFF, FACULTY, AND ON-CAMPUS USE UNTIL 2014-08-31

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lcc - LD1780 2012
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UFE0044070:00001


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1 A QUANTITATIVE EXPERIMENT OF THE EFFECTS OF TRANSNATIONAL CRISES ON CORPORATE AND COUNTRY REPUTATION AND STRATEGIC RESPONSES By HYUN JI LIM A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 2012

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2 201 2 Hyun Ji Lim

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3 To my family f or all that I have accomplished and become

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4 ACKNOWLEDGMENTS I have long dreamed of this moment, when I would be writing acknowledgments for my dissertation. As the last stage of writing my dissertation, this task provides me with the opportunity to look back at the last four years of my doctoral program to see that I am lucky to have so many people to whom I need to express my gratitude. Having someone who you like, admire, and respect as your adviser is one of the luckiest things in the world. I would like to t hank my wonderful advisor and chair Dr. Juan Carlos Molleda. He always encouraged me to come up with better ideas, and his advice inspired me to demonstrate my best for my dissertation I deeply appreciate his guidance and thoughtful consideration. I am al so thankful to Dr. Spiro Kiousis, who provided me with valuable advice and consideration, as well as research and teaching opportunities. Dr. Michael Weigold helped me with critical opinions regarding the experiment design and the data analysis of my disse rtation I really appreciate his serving as my committee member. I am also grateful for support from Dr. John Kraft, d ean of Warrington College of Business Administration He gave me valuabl e advice as my outside committee member and was always willing to help me with ideas in reference to international business I am also very grateful to Kim and Jody, who have consistently been warm and helpful to all of the graduate students, including me. I would like to express deep gratitude to my mentors back in Sout h Korea, Dr. Yungwook Kim and Dr. Heewon Cha. They always encouraged me to have confidence and they motivated me to do the best of which I am capable. From the time when I took my first public relations course in my undergraduate days, my mentors, Dr. Kim and Dr. Cha, inspired me to develop a great interest in the field of public relations academia and to earn a graduate degree.

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5 I want to offer to the Korean Communigators in the College of Journalism and Communications at the University of Florida my thank s. Without their friendship, help, endless opportunities for debates, and stimulating conversations, my doctoral program experience would not have been as memorable as it has been. Their friendship, love, and support have helped me immensely in both my sch ool and my personal life in Gainesville I would like to say thank you to my dear friends, Jiyoung Kim, Jungmin Park, Sunyoung Park, Jinsook Im, Yoojin Chung, Moonhee Cho, Jaejin Lee, Jooyeon Hwang, and Doori Song. I would also like to thank my good friend s in Korea for being there for me and offering their support in whichever way they could during my four years of study. A great thank you should go to my friends Jinjoo Choi, Heajin Jo, Jaeyong Jo, and Jongwoo Kim for their encouragement. They were always willing to listen whenever I had problems. I would like to express my appreciation to them. Finally, I cannot adequately express my gratitude toward my parents Sungchoon Lim and Y u njeong Yang, for their endless l ove and support. Their encouragement, guidance, patience, and belief in me are a reflection of the achievements I have made throughout my life. For everything they have done for me I am truly grateful, and I hope that, one day, I will be able to give back to them a small fraction of what they have given to me. Also, I would like to thank my dear brother, Wooyoung Lim, for his caring and love. He always offered a huge amount of support to me whenever I was frustrated, and I feel I am truly lucky to have him as a brother. I also want to thank my grandparents for their encouragement and love and for patiently waiting to see me each year. Without my family, I would not have been able to accomplish all that I have and would not be where I am today. I dedicate thi s thesis to them.

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6 TABLE OF CONTENTS page ACKNOWLEDGMENTS ................................ ................................ ................................ ............... 4 LIST OF TABLES ................................ ................................ ................................ ........................... 9 LIST OF FIGURES ................................ ................................ ................................ ....................... 10 ABSTRACT ................................ ................................ ................................ ................................ ... 13 CHAPTER 1 INTRODUCTION ................................ ................................ ................................ .................. 15 2 LITERATURE RE VIEW ................................ ................................ ................................ ....... 19 Reputation Management ................................ ................................ ................................ ......... 19 Corporate Reputation ................................ ................................ ................................ ....... 19 Country Reputation ................................ ................................ ................................ ......... 24 Country of origin Effect ................................ ................................ ................................ .. 25 Cross National Conflict Shift ing ................................ ................................ ............................ 28 Image Restoration Strategy ................................ ................................ ................................ ..... 35 Hypotheses and Research Questions ................................ ................................ ...................... 43 3 METHODOLOGY ................................ ................................ ................................ ................. 46 Pilot Study ................................ ................................ ................................ .............................. 46 Main Study ................................ ................................ ................................ .............................. 47 Design ................................ ................................ ................................ .............................. 47 Participants ................................ ................................ ................................ ...................... 47 Procedure ................................ ................................ ................................ ......................... 48 Research Stimuli ................................ ................................ ................................ .............. 49 Choosing c ountries and c ompanies ................................ ................................ .......... 49 Crafting n ews s tories ................................ ................................ ................................ 50 Questionnaires ................................ ................................ ................................ ................. 52 Independent Variables ................................ ................................ ................................ ..... 53 Level of country reputation ................................ ................................ ...................... 53 Use of image restoration strategy ................................ ................................ ............. 53 Country of origin salience ................................ ................................ ....................... 54 Dependent Variables ................................ ................................ ................................ ....... 56 Perceived country reputation ................................ ................................ .................... 56 Corporate reputation ................................ ................................ ................................ 56 Attitude towards products ................................ ................................ ........................ 57 Product purchase intention ................................ ................................ ....................... 57 Data Analysis ................................ ................................ ................................ ................... 57

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7 4 RESULTS ................................ ................................ ................................ ............................... 58 Sample ................................ ................................ ................................ ................................ .... 58 Manipulation Check for Independent Variables ................................ ................................ ..... 59 Country R eputation ................................ ................................ ................................ ......... 59 Country of origin S alience ................................ ................................ .............................. 60 Types of Image Restoration Strategy ................................ ................................ .............. 60 Reliability Check for Dependent Variables ................................ ................................ ............ 61 Hypotheses Testing ................................ ................................ ................................ ................. 62 Test of Hypothesis 1 ................................ ................................ ................................ ........ 62 Hypothesis 1A ................................ ................................ ................................ .......... 62 Hypothesis 1B ................................ ................................ ................................ .......... 62 Hypothesis 1C ................................ ................................ ................................ .......... 63 Hypothesis 1D ................................ ................................ ................................ .......... 63 Hypothe sis 1E ................................ ................................ ................................ .......... 63 Test of Hypothesis 2 ................................ ................................ ................................ ........ 63 Test of Hypothesis 3 ................................ ................................ ................................ ........ 64 Hypothesis 3A and 3A 1 ................................ ................................ .......................... 64 Hypothesis 3B and 3B 1 ................................ ................................ .......................... 65 Hypothesis 3C and 3C 1 ................................ ................................ .......................... 65 Hypothesis 3D and 3D 1 ................................ ................................ .......................... 66 Hypothesis 3E and 3E 1 ................................ ................................ ........................... 67 Research Question 1 ................................ ................................ ................................ ........ 67 Research Question 2 ................................ ................................ ................................ ........ 67 5 DISCUSSION ................................ ................................ ................................ ......................... 94 Summary of Results ................................ ................................ ................................ ................ 95 Hypotheses ................................ ................................ ................................ .............................. 96 Researc h Questions ................................ ................................ ................................ ................. 99 Implications for Theory and Practice ................................ ................................ ................... 101 Implications for Country Reputation ................................ ................................ ............. 101 Implications for Country of origin Salience ................................ ................................ 104 Implications for Crisis Communication Strategy ................................ .......................... 106 Implications for Practice ................................ ................................ ................................ 108 Implications for Public Relations Theory ................................ ................................ ...... 110 Limitations ................................ ................................ ................................ ............................ 112 Suggestions for Future Research ................................ ................................ .......................... 114 APPENDIX A INFORMED CONSENT PROTOCOL ................................ ................................ ................ 116 B EXPERIMENTAL MANIPULATIONS ................................ ................................ .............. 11 8 C QUESTIONNAIRE ................................ ................................ ................................ .............. 170 LIST OF REFERENCES ................................ ................................ ................................ ............. 178

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8 BIOGRAPHICAL SKETCH ................................ ................................ ................................ ....... 190

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9 LIST OF TABLES Table page 4 1 Sample demographic profiles ................................ ................................ ............................ 69 4 2 Comparison ratio of sample and population ................................ ................................ ...... 69 4 3 Experimental block frequencies ................................ ................................ ......................... 70 4 4 Multivariate tests for manipulation check of country reputation (CR), country of origin salience (COS), and types of image restoration strategy (IRS) ............................... 70 4 5 Manipulation check for country reputation ................................ ................................ ........ 70 4 6 Manipulation check for country of origin salience ................................ ........................... 71 4 7 Manipulation check for types of image restoration strategy ................................ .............. 71 4 8 Measurement reliability for all items ................................ ................................ ................. 71 4 9 Multivariate tests for country reputation, country of origin salience, and types of image restoration strategy ................................ ................................ ................................ .. 72 4 10 Results of between subjects test ................................ ................................ ........................ 73 4 11 Main effect of country reputation ................................ ................................ ...................... 74 4 12 Main effect of country of origin salience ................................ ................................ .......... 74 4 13 Main effect of type of image restoration strategy ................................ .............................. 75 5 1 Result of hypotheses ................................ ................................ ................................ ........ 100

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10 LIST OF FIGURES Figure page 4 1 Main effect of level of country reputation on perceived country reputation ..................... 76 4 2 Main effect of level of country reputation ..... 76 4 3 Main effect of level of country reputation on purchase intentions toward the cou ................................ ................................ ................................ .............. 77 4 4 Main effect of level of country reputation on perceived company reputation facing a crisis ................................ ................................ ................................ ................................ ... 77 4 5 Main effect of level of country reputation on purchase intention of products of the company facing a crisis ................................ ................................ ................................ ...... 78 4 6 Main effect of country of origin salience on perceived country reputation ...................... 78 4 7 Main effect of country of ...... 79 4 8 Main effect of country of products ................................ ................................ ................................ .............................. 79 4 9 Main effect of country of origin salience on perceived company reputation facing a crisis ................................ ................................ ................................ ................................ ... 80 4 10 Main effect of country of origin salience on purchase intention of products of the company facing a crisis ................................ ................................ ................................ ...... 80 4 11 Main effect of type of image restoration strategy on perceived country reputation .......... 81 4 12 Main effect of type of image restoration products ................................ ................................ ................................ .............................. 81 4 13 Main effect of type of image restoration strategy on purchase intentions toward the ................................ ................................ ................................ .............. 82 4 14 Main effect of type of image restoration strategy on perceived company reputation facing a crisis ................................ ................................ ................................ ..................... 82 4 15 Main effect of type of image restoration strategy on purchase intention of products of the company facing a crisis ................................ ................................ ................................ 83 4 1 6 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration strategy on perceived country reputation ............ 83

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11 4 17 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration st products ................................ ................................ ................................ .............................. 84 4 18 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration strategy on purchase intentions to ward the ................................ ................................ ................................ .............. 84 4 19 Three way interaction effect of level of country reputation, country of origin salience and t ypes of image restoration strategy on perceived company reputation facing a crisis ................................ ................................ ................................ ..................... 85 4 20 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration strategy on purchase intention of products of the company facing a crisis ................................ ................................ ................................ 85 4 21 Two way interaction effect of level of country reputation and country of origin s alience on perceived country reputation ................................ ................................ ........... 86 4 22 Two way interaction effect of level of country reputation and country of origin ................................ .......................... 86 4 23 Two way interaction effect of level of country reputation and country of origin ................................ ......... 87 4 24 Two way interaction effect of level of country reputation and country of origin salience on perceived company reputation facing a crisis ................................ ................. 87 4 25 Two way interaction effect of level of country reputation and country of origin salience on purchase inte ntion of products of the company facing a crisis ....................... 88 4 26 Two way interaction effect of level of country reputation and types of image restoration strategy on perceived country reputation ................................ ......................... 88 4 27 Two way interaction effect of level of country reputation and t ypes of image restoration ................................ ........ 89 4 28 Two way interaction effect of level of country reputation and types of image restoration ....................... 89 4 29 Two way interaction effect of level of country reputation and types of image restoration strategy on perceived company repu tation facing a crisis ............................... 90 4 30 Two way interaction effect of level of country reputation and types of image restoration strategy on purchase intention of products of the company facing a crisis ..... 90 4 31 Two way interaction effect of country of origin salience and types of image restoration strategy on perceived c ountry reputation ................................ ......................... 91

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12 4 32 Two way interaction effect of country of origin salience and types of image restoration ................................ ........ 91 4 33 Two way interaction effect of country of origin salience and types of image restoration ....................... 92 4 34 Two way interaction effect of country of origin salience an d types of image restoration strategy on perceived company reputation facing a crisis ............................... 92 4 35 Two way interaction effect of country of origin salience and types of image restoration strategy on purchase intention of products of the company facing a crisis ..... 93 5 1 ................................ ......................... 109

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13 Abstract of Dissertation Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy A Q UANTITATIVE EXPERI MENT OF THE EFFECTS OF TRANSNATIONAL CRISES ON CORPORATE AND COUNTRY REPUTATION AND STRATEGIC RESPONSES By Hyun Ji Lim August 2012 Chair: Juan Carlos Molleda Major: Mass Communication This study analyzes the potential effects of a transnational corporate crisis on corporate and country reputation and explores how the image restoration country of origin during a crisis in terms of managing its reputation will influence the attitude and behavioral intentions of people in other countries. Most previous research studies focus on the strategic responses of c orporations during crises. Through the employment of a 2x2x3 factorial experiment, this study attempts to examine how three factors, level of country reputat ion, country of origin salience and types of image restoration strategy, can affect host customers its country of origin and provoke changes in its intended behavior. Results indicate that there was no three way interaction effect or two way interaction effects among the level of country reputation, c ountry of origin salience, or types of image restoration strategies. The results of the study reveal the importance of maintaining a good reputation in affects not o

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14 this study, country of attitudes and behavioral intentions. The findings of this study suggests that employing a corrective action strategy is recommended for managing the reputations of both the multinational corporation facing the crisis and its home country for the long term perspective, even though using denial strategy on This study provides empirical evidence regarding whether adopting an image restoration strategy h elps a country to recover its reputation during a crisis and creates an opportunity to gain a better understanding of how multinational corporations are influenced by the reputations of their countries of origin. It also contributes to the development of p ublic relations research by adding to the literature on the interaction of country and corporate reputations and provides empirical evidence of strategic responses employed by various countries.

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15 CHAPTER 1 INTRODUCTION There is strong conventional wisdom in public relations practice that reputation matters. This is evidenced by the volume of literature offering advice and input on reputation management (Caudron; 1997, Davenport, 1989; Holmes; 1995; Lukaszews ki, 1997, Patterson, 1993). While the importance of a good corporate reputation is widely acknowledged, its intangibility has caused widespread uncertainty among public relations experts about its judgments, the origin of which is a story, an action, a report, a meeting, or an interview should be effectively managed for the best possible reputation ( Budd, 1997). It stands to reason that reputation is important, but there is little empirical evidence about the extent of its importance. Managing all the signals of a company to attain its best reputation becomes even more important when the company is fa cing a crisis, because the media becomes interested in anything that involves the company. Managing reputation in a crisis situation is becoming more complex because the development of interactive media and information technology has prompted the globaliza tion of business transactions, politics, and economics, which has lessened the meaning status that involves three key components: worldwide learning, multinatio nal flexibility, and national responsiveness (Barlett & Ghoshal, 1989). Molleda and Connolly multinational corporations ( MNC particular countries c ould impact transnational publics in many other locations. This includes the home

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16 Molleda and Connolly Ahern (2004) developed the theory of Cross national conflict shifting (CNCS) in order to study public relation s practices during such transnational processes (Molleda & Connolly Ahern, 2002; Molleda, Connolly Ahern, & Quinn, 2005; Molleda & Quinn, 2004). CNCS theory argues that if a MNC is involved in a conflict or crisis in one country, the crisis could potential ly shift to another country or countries, with increased levels of threat. This, in turn, could taint the MNC even cause financial harm at the transnational level. There has been growing interests and research on crisis communication in t he field of public relations with increased recognition (e.g., Benoit, 1997; Coombs, 1995, 1999a; Heath & Miller, 2004; Ihlen, 2002). However, studies that focus on cross national or transnational crises have been relatively few. Like most other crises, a cross national conflict occurs unpredictably Yet as it has effects are global scale not limited to only one country, the consequences could be enormous and gr eater than usually anticipated. Also, researchers studying the impacts of transnational crises h ave been mostly focused on the reputation of MNCs However, it is noteworthy to explore the interplay between the reputation of the country where the MNC MNC It is true that the country of origin effect has become ineffective or blurred (Nakra, 2006) due to globally integrated supply chains. In addition, a new consumer trend seems to be moving toward strong brand/product preference without substantial knowledge about brand origin. Also, a multinational c orporation ( MN C) may intentionally make downplay the country of origin as part of its communication strategies especially when it believes negative country reputations might be linked to negative product evaluations (Papadopoulos & Heslop, 1993).

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17 Often, brand and country image are closely tied, as is often cited in th e cases of megabrands like Coca Cola and Toyota (Johansson and Nebenzahl, 1986). I t cannot be denied that some MNC s are strongly associated with their countries of origin, whether they benefi t from that or not (e.g., Samsung, Hyundai, South Korea; Toyota, Japan; Apple, the United States of America; etc.). Some may benefit from a country of origin suffer from the negative image of a country of origin However research with this focus is lacking, especially that which focuses on the relationship between the MNC country reputation in a crisis situation. O ne aim of this dissertation is to explore if there exists country of origin effect in c risis situation and how countries respond to transnational crises using image restoration strategies In other words, the proposed study aims to analyze the potential effects of transnational corporate n c orporate and c ountry r eputation and to examine the effect of types of s trategic r esponses from an image restoration perspective Moreover, the current study investigate s if there exists a n interaction effect between level of country reputation, leve l of country of origin salience and types of image restoration strategy on the attitudes and behavioral intentions of foreign publics. This study provides an opportunity to gain greater understanding of how a multinational corporation (MNC) is influenced by th e reputation of its country of origin. Specifically, the study focuses on how U.S. consumers may evaluate both country reputation and the company reputation of a MNC facing a transnational crisis while the strategic response of the country is reported by t he news media. This will be accomplished by incorporating theories such as reputation management, cross national conflict shifting, and response strategy.

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18 The researcher expects this study to contribute to the development of global public relations researc h by furthering the study of country reputation in interactions with corporate reputation and by providing additional empirical data on image restoration theory and how countries employ it as they are important variables that should be considered in public relations research, as well as for public relations professionals when planning public relations strategy in various situations for various domestic and global publics.

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19 CHAPTER 2 LITERATURE REVIEW Reputation Management Corporate Reputation Public relations practitioners are in charge of managing the creation and maintenance of a Cameron, 2000, as cited in L yon & Cameron, 2004, p. 215). According to Lerbinger (1997), corporate reputation can affect everything from stock values to employee morale. Since the launch of the foundational issue of Corporate Reputation Review in 1997, in which Fombrun and van Riel ( 1997) pointed out the lack of studies on corporate reputation, the literature regarding this field of stu dy has been growing Scholars in public relations field and business literature have paid much attention to t he concept of corporate reputation over th e past two decades (e.g., Bennett & Kottasz, 2000; Eberl & Schwaiger, 2005; Hutton, Goodman, Alexander, & Genest, 2001; Kim, 2001). It is clear that reputation is a relevant construct. Although there is a clear definition of the term reputation in Webster' s Revised Unabridged 2001). Wartick (1992) defines corporate reputation perception of how well organizational responses are meeting the demands and expectations of many corporate s

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20 n is More recently, Bere ns and van Riel (2004) looked at the types of associations used in conceptualizing reputation in the literature and concluded that there are three conceptual streams: social expectations, corporate personality, and trust. Barnett et al. (2006), reviewing a nd analyzing 49 unique sources with corporate reputation definitions, identified three distinct Previous research about reputation (e.g., Fombrun, 1996; Fombrun & van Riel, 2003) supportive behaviors. According to Fombrun and van Riel (2003) reputation is important f distinctiveness that produces support for the company and Corporate reputation and corporate image are occasionally considered confusing, thus people sometimes think the terms are synonymous (Dowling, 1993). Thus, it is important to note the distinction between the two constructs. Reputation differs from corporate image in that it is owned by the publics (Lyon, 1999). out Lyon & Cameron, 2004, p. 215). Companies can manage their images through various controlled signals such as corp orate advertising, sponsorships, and special events. However, reputation is

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21 created and destroyed by everything a company does, from the way it manages employees to the allocation and history can be regarded as part of its reputation (Fombrun & van Riel, 1997). Researchers have investigated the expected benefits accompanying with a strong reputation, such as increased financial performance (Roberts & Dowling, 2002), increased advertising effectiveness (Goldberg & Hartwick, 1990), ability to charge a premium (Klein & Leffler, 1981; Milgrom & Roberts, 1986 a) improved employee recruit ment (Stigler, 1962), easier product introduction (Dowling, 2001), increased access to capital markets (Beatty & Ritter, 1986), ease of attracting investors (Milgrom & Roberts, 1986 b ), and increased sales force effectiveness (Dowling, 2001). Much of the is sue with reputation is related to its documented influence on financial revealed a link among public relations expenditures, reputation, and financial performance. The s tudy found that as the unit of public relations expense increases, a positive effect on the revenue can be expected. However, the study cannot predict that more e xpenditure for public relations activities such as public relations messages and news content leads to greater impact on Even so such research is critical since it can demonstrat e the effectiveness of specific types of public relati ons activities (e.g., media relations). Previous research suggests that there are two key communication factors linked with mass media (e.g., Fombrun & Shanley, 1990; Hutton et al., 2001). Hutton et al. (2001) focused

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22 communication activities by empirically surveying Fortune 500 companies. There was no strong correlatio n between reputation and overall amount of spending on corporate communication activities; it found some correlations between reputation and specific categories of spending including foundation funding, investor relations, executive outreach, media relatio ns, and industry relations. One of the approaches to corporate reputation in public relations is made by focusing on coverage in mass media. Carroll and McCombs (2003) focused on the influence of news coverage on corporate reputation among the public. By employing the theory of agenda setting, which presumes the transfer of salience from the media agenda to the public agenda, they found out that the media salience of company portrayal influenced the reputation of the company. Focusing on the role of communication in the construction of corporate reputations, messages on media co verage of a corporation, on corporate reputation, and on financial corporate reputation by incorporating agenda building and agenda setting theories. It was found that emphasizing different attributes through different media outlets helps bring effective (Kiousis et al., p. 161). Researchers tried to demonstrate how good public reputation plays a critical role in benefiting corporations with empirical studies. Lyon and Cameron (2004) related the corporate reputation study to the crisis situation. Their res earch findings successfully showed that

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23 participant responses toward bad publicity could vary, depending on prior corporate reputation. T he results showed that in times of crisis, a company can have more broad response strategies if it has a good reputatio response is more honest than others. So, if a company has a good prior reputation, its pro social messages are interpreted as a mutually beneficial activity rather than being perce ived as a self interested activity. Similarly, Bae and Cameron (2006) suggested that prior corporate reputation affects public perceptions toward corporate philanthropic messages and ultimately affects public attitudes towards the company. They applied the concept of reputation in the field of CSR study in public relations using experimental research method which involved newspaper articles as research stimuli; the result showed that participants inferred corporate charitable giving as a mutually beneficial activity when a company had a good reputation and as a self interested activity when the company had a bad reputation. In addition to the efforts to reach a consensus regarding the importance of reputation as a concept, scholars have worked on developing a measurement for corporate reputation (Fombrun, most commonly used barometer, yet scholars have reported several problems associated with this indicator, including it s heavy reliance on CEO and analyst perceptions for its rankings ( e.g., Fryx ell &Wang, 1994). To provide a more general gauge of reputation among consumers and the general public, the Reputation Quotient index by Harris Interactive and the Reputation Insti tute (detailed in the following Methods section) has been engendered as a valid measure of corporate reputation among external stakeholders (Gardberg & Fombrun, 2002).

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24 Fombrun, Gardberg, and Sever (2000) defin ed asse measures how a typical group of stakeholders perceive six underlying dimensions of reputation: emotional appeal, products and services, financial performance, vision and leadership, workplace environment, and social responsibility. Country Reputation countries. However, reputation managem ent is no longer restricted in the realm of companies and other organizational entities. In fact, more and more nations are now concerned with their reputation and are trying to actively measure and manage their reputation (Passow et al., 2005). Country re 2006, p. Country reputation has the value to be examined from various perspectives. First, from the perspective of public diplomacy, Nye (2004) claimed that soft power becomes more relevant as a national strategy for diplomacy. It has been an essential part of internationa l relations and public diplomacy to manage national reputation and maintain nation publics. Lately, opinions of a foreign public are gaining significance to a greater extent in forming an emerging globalized public and inf luencing international political process and outcome (Wang, 2006). Effective country reputation management helps to develop and enhance the soft power of a country, which is to manage attractiveness of a country in the minds of stakeholders overseas (Yang, Shin, Lee, & Wrigley, 2008). Anholt (2002, 2007) and the Anholt GMI Nation Brand Index (2005) approached country reputation from the perspective of nation branding. Anholt

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25 by applying the concept of brand to a countr y, noting that a country has to establish and manage its reputation if it wants to gain competitive advantage and have the global brand equivalent to that enjoyed by a company. When a country owns a favorable reputation, it can enjoy international consumer country from the country of origin perspective (Al Sulaity & Baker, 1998; Knight & Calantone, 2000; Gurhn Canil & Maheswaran, 2000; Han, 1989, 1990). If a country wants to manage its reput ation, measuring its current reputation is prerequisite. Harris Fombrun Reputation Quotient (RQ) is one of most widely used measurement models to measure corporate reputation (Fombrun & Gardberg, 2000; Fombrun, Gardberg, & Sever, 2000). Passow et al. (2005 ) developed an adapted version of RQ suitable for measuring country reputations, called Fombrun RI Country Reputation Index (CRI). Country of o rigin E ffect Another useful theoretical framework regarding country reputation can be found from the field of int ernational marketing, country of origin effect. According to this framework, country reputation works as behavior, and evaluations of individual products/brands made in that c ountry (Al Sulaity & Baker, 1998; Knight & Calantone, 2000; Gurhn Canil & Maheswaran, 2000; Han, 1989, 1990, Parameswaran & Pisharodi, 1994). As the manufacture and distribution of products and the quest for consumers become increasingly global activities, international business undertake greater importance than ever before (Roth & Romeo, 1992). Over the past three decades, the effect of country of origin (Roth & Romeo, 1992, p. 477), has been one of the most widely studied

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26 topics in the field of international business, marketing, and consumer behavior literatures (Peterson & Jolibert, 1995). Bilkley and Nes (1982) qualitatively evaluated the result of prev ious COO studies to that point in time, and argued country of origin does country of origin extrinsic product cue an intangible product attribute that is distinct from a physical product 4). Country of shown the effect of COO in influencing the evaluation of products in general (Laroche et al., 2005), classes of products (e.g., Nagashima, 1970; Ittersum, Candel, & Meulenberg, 2003), specific types of brands of products (e.g., Parameswaran & Pisharodi, 1994, H ubl, 1996; Lampert & Jaffe, 1998), consumer and industrial products (e.g., Heslop & Papadopoulos, 1993 ) as well as services (e.g., Javalgi, Cutler, & Winans, 2001). It is known that the COO has a strong ticular (Shimp & Sharma, 1987; Han, 1988). The country of origin effect can occur through two primary routes. First, when consumers of origin to establish inferen On the other hand, when consumers have a high familiarity between product and country and the country of origin effect can fun ction as

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27 attributes and country reputation. These routes enable international consumers to match product categories with country reputations (Roth & Romeo, 1992 ). Regarding the relationship between country of origin image (COI) and country brand equity, previous efforts primarily focus on how perceived brand quality is affected by the COO of a product (Thakor & Lavack, 2003); how brand image potentially mitigates the effect of COO (Han & Terpstra, 1988; Tse & Lee, 1993); the relative importance of the name of the brand in direct effect of brand and COO cues on different pro duct quality dimensions (Thakor & Katsanis, 1997); and the impact of the country of origin image and COO of a brand on its consumer based brand equity (Lin & Kao, 2004, Pappu, Quester, & Cooksey, 2006, 2007). However, no study exists so far that has empiri cally tested the impact of country image on the equity of a particular country (Zeugner Roth, Diamantopoulos, & Montesinos, 2008, p. 585). In general, it is considere d that a positive (brand, corporate, or country) image result in a positive (brand, corpor ate, or country) equity (e.g., Yoo & Donthu, 2001; Lin & Kao, 2004; Jaffe & Nebenzahl, 2006; Pappu, Quester, & Cooksey, 2007). For example, Jaffe and Nebenxahl Roth, Diamantopoulos, & e may be an asset when it MNC may be amplified when the MNC faces a transnational crisis, or a cross national conflict shift.

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28 Cross National Conflict Shifting The advent of emergent, interactive technologies in communication channels has changed the atmosphere of global public relations and brought a whole new perspective in shaping the role of who create news/co ntent and who consume the news/content. News of a noteworthy event which originates in one location is now simultaneously spread around the world through mainstream and emergent communication and media technologies (Molleda, 2010).In other words, use of In ternet communications with the unprecedented power has enabled that a local issue can easily shift across national borders and impact stakeholders internationally. Therefore, the impact of issues and problems are not restricted by geographical boundaries ( Seymour, 2002). Adding up to the power of traditional mass social networks on the Internet have allowed individual users to be actors as social activists or se globalized and simultaneous communications, issues affecting the relationship between transnational organizations ( MNC s) and multiple publics have been more complex (Sharpe & Pritchard, 2004). Today, MNC &Holtbrgge, 2001, p. 112, as cited in Molleda& Connolly Ahern, 2002). These groups watch over the MNC behaviors in different operational sites, according to German international business scholars Weldge and Holtbrgge (2001). Berg and Holtbrgge (2001) groups in one country condemn multinational corporations for what they are doing in other Connolly Ahern, 2002, p. 112). Thus, conflicts are no longer incidents that matter only in the single country where they first happened; they may be (Weldge & Holtbrgge, 2001 p. 324).

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29 There have been two studies that have focused crisis communication within range of the dimension of public relations to The findings of two cross national studies by Taylor (2000) and Freitag (2001) were used to conceptualize the CNCS theory. documented the case of the Coca Cola scare in Europe by analyzing The crisis first occurred in Belgium when schoolchildren became sick after drinking Coca Cola. The crisis also had an impact in Spain and France. The study showed that the national culture of a country works as a n factor that affects the reaction of the respective host publics. Those who live in countries of high uncertainty avoidance and power makes sense that those nations would respond quickly and severely to any threats to public Freitag (2001) examined international media coverage of the Firestone Tire recall case, portrayed by newspapers in Canada, Denmark, Franc e, Germany, New Zealand, Poland, United Kingdom, United States, and Venezuela. Freitag (2001) discussed potential factors that determine media coverage on an issue, such as media structure and function and cultural syndromes, which determine crisis plannin g and response strategies by analyzing media reports. headquarters, and the direct links between the companies and their countries of origin predict the amount of n ational news coverage. The concept of cross national conflict shift (CNCS) was first introduced to the academic world of public relations study by Molleda and Connolly Ahern (2002) based on the idea of

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30 from the discipline of internat ional management (Berg & Holtbrgge, 2001; Welge & Holtbrgge, 1998, 2001) and Molleda and Connolly Ahern (2002) developed the concept into a systematic conceptualization of CNCS theory in the global public relations area. A cross national conflict shift i nvolves diverse publics at various geographic levels, including host, home, and transnational publics (e.g., NGOs and activist groups, global media outlets, and shareholders; Molleda & Connolly MNC utation and even result in negative financial and legal consequences at both home and ho 2011 p. 3). Home publics are those who reside in the country where the MNC has its headquarters. Home publics exist in the local, state, or national levels; especially, government agencies in the demand rapid explanation of any incident in volving national business or institutional interests in foreign nations. By contrast, host publics inhabit in the countries where the MNC operates or gets involved in domestic affairs. The number and level of involvement of host publics may be determined b y where exactly the incident occurs that is, in their country, in the region, in another host nation or nations, or in the corporate headquarters. In general, when the situation is closer to the host country, the impact, the number of publics, and the le vel of activist involvement of those publics are predicted to be greater (Molleda, 2010). Molleda and Connolly Ahern (2002) brought a case study to enhance understanding of the concept of CNCS where a legal incident involving America Online Latin America ( AOLA) in Brazil, which caused repercussions in U.S. and European financial markets. Molleda and Connolly Ahern further elaborated the conceptualization of CNCS: There are organizational decisions, actions, and operations that affect publics in one country and have an impact internationally. This impact seems to be greater at the

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31 home country of the organization or organizations involved, which could be explained by the relevance and proximity of organization for the home publics. Domestic conflicts are inc reasingly shifting worldwide because of the growth of international transactions, transportation and communication, es pecially information technology ( Molleda and Connolly Ahern 2002 p. 4) Molleda and Quinn (2004) expanded the dynamic of CNCS theory and used four issue, (2) the ways a national conflict reaches transnational audiences, and (3) the parties of corporate social performance and responsibility were suggested as the issues producing CNCS. Factors which transfer the CNCS to MNC itself accepting its involvement or guilt, local or international news media outlets, common citizens, domestic or international activist groups, or government officials who denounce wrongdoings 2011 p. 5).To test their study, Molleda and Quinn suggeste d the following 10 propositions: P1 Cross national conflict shifting is mainly related to corporate social performance issues and negative economic consequence of globalization. P2 The magnitude of a cross national conflict shifting will increase when i t starts in an emergent or developing economy because of the greater pressure the transnational corporation will face in the host country and from the international activist community. P3 Conflicts that occur in developed nations usually have a shorter l ife and do not cross borders as often as conflicts that start in developing nations or emergent economies. P4 A greater number of involved parties will characterize a cross national conflict s the principal participant of the crisis. P5 A lower number of involved parties will characterize a cross national conflict shift in which a developing nation or emergent economy corporation is the principal participants of the conflict.

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32 P6 Transnatio nal corporations that produce or commercialize tangible, boycottable products are more likely to receive attention than those who produce and commercialize intangible services. P7 Transnational corporations headquartered in developed nations that produce or are part of a national conflict outside their home country will attract significant attention from global NGOs, international regulatory bodies, national governments, organized citizen groups, and international news agencies and global media outlets. P8 The direct involvement of a transnational corporation in a cross national conflict shift will produce greater consequences and demand a more comprehensive set of response than a transnational corporation that is indirectly related to the issue. P9 Na tional conflicts shift to the international arena when (primarily) global NGOs or media report on the situation to audiences or publics in different parts of the world. P10 National conflicts with a great human interest focus are likely to be shifted to the international arena. (pp. 5 7) Findings of Molleda, Connolly propositions and revealed that most frequently used sources in CNCS news coverage are the government officials, MNC representatives, and int ernational NGOs. Molleda et al. (2005) called for more studies to further test and develop the theory of CNCS. Future work is expected to include case studies of CNCS not directly involving a government function, other media sources besides newspapers, and a wider range of language sources in cases involving a non English speaking country (Molleda et al., 2005). Several studies followed to examine corporate transnational crises and advance the CNCS theory by using the propositions (Kim & Molleda, 2005; Lim & Molleda, 2009; Molleda, management. To analyze how Halliburton responded to the issue, t he study was based on

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33 justification, ingratiation, corrective action, and full apology. Kim and Molleda (2005) developed three new complementary propositions fro improve CNCS theory with a more complex context, including political aspects; P11. Although a transnational corporation that does not produce or commercialize tangible, boycottable products, if the CEO or top level manage ment have a cohesive relationship with the home country government or another highly visible institution, it will draw more attention from home country media, international media, international NGOs and regulatory bodies, and the issue will have greater po litical repercussions and debates. P12. Domestic or national conflicts are not only perceived differently by related parties in the home country and host country, but also framed differently by the host country and home country media. P13. National or do mestic conflicts of transnational corporations are sometimes combined with other related conflicts or issues that negatively affect the reputation of transnational corporations in home and host countries and, therefore, require more complex responses and p ublic relations strategies (until the conflicts resolve). (pp. 14 16) Additionally, Kim and Molleda (2005) suggested that there exists a perceived difference host domestic conflicts of MNC s are blended with other related issues which may have negative influence on the reputation of MNC s; hence, more complex responses and public relat ions strategies are required to resolve the crisis. CNCS. T he U.S. E nvironmental Protection Agency has made an action against DuPont, and it caused the c risis initiated in the United States A nd then it unexpectedly shifted to China and involving a MNC shifts from a home country to a host country and results in greater impac t in the host country 2011 p. 6). Three perspectives were developed from the

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34 crisis management performance of the involved transnational corporation, the level of media int erest in the involved issue and the unique and complicated social and cultural context CNCS theory deals with transnational crises, reviewing theories of crisis communication helps one to develop a better understa nding of CNCS. Molleda, Solaun, and Parmelee (2008) examined the CNCS theory by analyzing tainted toys manufactured in china and sold in the United States and other global markets. The transparent and timely response, however, Mattel failed to manage the needs of host, home, and transnational publics from a global viewpoint. The Chinese government and manufacturing companies were not prepared for a crisis communication strategy. Thus their defense actions were not communicated until the late stage of the conflict, and even expanded the conflict when communicated. Mo lleda et al. (2008) suggested that the crisis would have not been deteriorated to such a grand scale if Mattel and the Chinese government have cooperated to resolve the crisis by acknowledging their shared roles and responsibility from when the crisis init iated. Lim and Molleda (2009) approached the CNCS theory in aspects of its particular effect on home and host customers. They study gave empirical causality to the CNCS theory by using experimental research method; which revealed that the type of crisis si gnificantly affected finding claimed that a massive product recall produced more negative responses from potential

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35 prior attitude toward a MNC affected their attitude formation and behavioral intentions. Since the consumers mostly learn about a MNC and their attitudes and behavioral intentions toward the MNC are influenced by how crisis is viewed by the media, it is important that a MNC should employ a strategic i mage restoration strategy in an attempt to repair its image. Image R estoration Strategy As image is important to individuals, so is it to organizations including corporations, government bodies, and non profit groups (Benoit, 1997). Even though the concept of image is being replaced by reputation since a notion of image is a single impression shared by an audience (Moffitt, 1994), image is still an essential concept in the field of public relations. An organizational crisis is typically related with an unex pected about which key stakeholders a ttribute cause and responsibility (Coombs & Holladay, 1996). If its efforts to create understanding and maintain mutually beneficial relationships with its stak compete in the marketplace (Heath & Millar, 2004). Today, because of a variety of environmental developments, organizations are becoming more vulnerable to cri ses (Barton, 1993). Thus, in order to be prepared for image problems caused by crises, organizations should take preventive (Heath, & Neison, 1986) and restorative approaches (Allen & Caillouet, 1994; (Dionisopoulos &Vibbert, 1988) When choosing among pos sible organizational responses,

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36 c risis managers should use well structured action Public relations researchers have developed a systematic and theory based approach regarding this image restoration strategy (Benoit, 1995 ; Coombs, 1998a; Coombs & Holladay, 1996; Millar & Heath, 2004; Ihlen, 2002). In addition to past history indicating that the best way to respond to negative publicity is with an internal locus of responsibility, public relations researchers have developed newer crisis communicati on models to address specifically how an organization might defend itself (Coombs & Holladay, 1996). These research findings help practitioners establish a useful framework in determining the most appropriate crisis response type, ranging from accommodativ e to defensive strategies. Benoit (1997) introduced the basic concepts to understand image restoration theory. First, regardless of what happened, it is not rational to form an adverse impression of a firm unless that company is considered to be responsib le for that act. Second, organizations facing crises should words, what is important here is not whether an organization is actually responsible for the offens ive act, but whether the organization is believed to be responsible for what is caused by wise, this is applied to the act. Rather than if the act done as a reaction to crisis by an organization is in fact offensive, how the act is believed by the relevant audience to be vicious is more important. Finally, identifying the most important audienc e among multiple audiences around the organization is assumed to be the last key point. The theory of image restoration discourse gives importance to message options rather than the type of crisis which an organization faces or it is in what stages of a cr

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37 Among the previous research findings of image restoration (repair) theory, Coombs (1998 ) noted that organizational image can be negatively related to perceived crisis resp onsibility. Crisis responsibility symbolizes the degree to which stakeholders assumes the organization is liable for the crisis event. A number of typology systems have been developed by various scholars to categorize response strategies and interpret how corporate entities or individuals execute their self defense in a crisis situat ) five strategy, 14 subcategory typology is regarded as the most comprehensive image restoration typology widely used in personal and corporate im age restoration studies and Benoit developed more exhaustive study in 1997. ) argued that reputation as well as other important assets should be well managed in order to achieve the best results. Based on previous research fr om this background, Benoit developed the image restoration typology, which includes five general strategies: denial, evasion of responsibility, reducing the offensiveness of the event, corrective hensive image restoration typology widely used in personal and corporate image restoration Denial has two subcategories. If an organization wants to deny any responsibility for an event, they use simple denial In contrast, if an organization tries to shift the blame to individuals or an outside organization, shifting blame or scapegoating is employed. Evasion of responsibility includes the four subcategories of provocation, defeasibility, accident, and good intentions. Provoca tion is a strategy that involves arguing that the way the accused organization acted was only to react to another individual or organization that acted offensively. Defeasibility is claiming that the alleged action was a result of the organization not havi ng enough information or control. Accident is a strategy used when the organization argues

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38 that the alleged action took place by accident. Claiming good intentions entails asserting that even though the action was offensive, it was done with good intention s. Reducing the offensiveness of the event consists of six versions. Bolstering puts emphasis on the positive aspects of what the organization has and what it has done before; this way, the itself and offset the negative feelings caused by its wrong doing. Minimization is used when the organization attempts to deemphasize the negative effects following its wrongful action Differentiation is needed when distinguishing the exact act that trigg ered the crisis from other related but more offensive acts. Transcendence is putting the alleged act in a more positive context. Attacking the accuser harms the credibility of the source of the accusation, and compensation pays the victim back in order to reduce the negative effect. Corrective action is the strategy used when the accused promises to correct the problem by taking action such as keeping the same problem from occurring again and restoring the operation to its previous condition. Lastly, mortification is a strategy that is used when the accused confesses wrongdoing and asks for forgiveness (Benoit, 1997). categorized along with how much the organization feels responsib le for the crisis and the attitude that they are willing to take into corrective action and mortification. Corrective action was one of subcategories in the as it can be taken without admitting fault. Following the types of strategies, Benoit (1997) gave suggestions for effective image restoration discourse. First, it is recommended for an organization at fault to admit its wrongful

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39 act immediately. This may conflict with the desire to avoid law suits; therefore, the organization should decide which is more important at the moment in crisis situation whether to focus on restoring its reputation or not to be involved in litigation. In addition to the fact that admitting the fault is morally the desirable behavior, if the organization tries to deny true accusations, it may re some cases when shifting the blame works successfully; however, it is not likely to be viewed as a certain solution to image problems. Rather than finding whom to blame, addressing plans to correct or avoid future problems is more assuring even though it does not always guarantee success. Finally, Benoit (1997) classified that multiple image restoration strategies can work together. Coombs and Schmidt (2002) introduced an experimental study concerning the case of s (1995) theory of image restoration. In late 1996, a lawsuit regarding racial discrimination was raised against Texaco in which secret tape recordings revealed that racially discriminatory language had been used by top executives. Because of the recording an enormous amount of negative publicity was triggered that endangered the reputation of Texaco. This crisis was settled by the prompt action of the CEO of Texaco, who swiftly punished those who were involved. Coombs and Schmidt reported that during this action, four image restoration strategies were used (a) bolstering, (b) corrective action, (c) shifting blame, and (d) mortification in addition to one more strategy combining three image restoration strategies: (e) separation, a combination of bolstering shifting blame, and corrective (Brinson & Benoit, 1999, as cited in Coombs & Schmidt, 2002, p. 166). Within the image restoration literature, Drumheller and Benoit (2004) explored cultural issues using the case of the USS Greeneville Ehime Maru The USS

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40 Greeneville came into collision with the Japanese trawler named Ehime Maru near Pearl Harbor, and nine people in the trawler were kill part of an U.S. Navy public relations effort, questions were raised about whether the visitors had r estoration efforts in this case, the U.S. Navy used mortification, which was largely appropriate, considering Japanese culture. It was expected for Captain Waddle to apologize directly to the shows the importance of making efforts through diplomacy in image restoration especially when it comes to cultural issues. In addition, it suggests that the idea of using the instigator as a spokesperson is ideal, as is responsibility. category typology, which is considered as the most closely related to public relations efforts (Seeger, Sellnow, & Ulmer, 2003). Although previous research findings (Allen & Caillou et, 1994; Benoit, 1995 1997) offer a broad array of image restoration strategies, crisis managers can select the appropriate response for the crisis only after they fully understand the crisis situation. (1998) aimed to refine a system for analyzing cri sis situations, which can be useful for crisis managers. In developing the system, Coombs suggested that there are seven possible response types to negative or crisis situations: attack the accuser, denial, excuse, justification, ingratiation, corrective a ction, and full apology. Attack the accuser 1998, p. 180). This strategy can be used i n situations in which an organization is not considered

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41 responsible at all for the crisis. Denial means the organization does not acknowledg e that the crisis exists and does not explain e why there is no crisis. When the organization is making an excuse it intention to do harm and claiming the organization had no control of the events that led to the justification is different from an excuse in that it is an which the organization feels more responsible for the crisis (Coombs, p. 180). Ingratiation is ng. When c risis managers employ ingratiation they try to make stakeholders like the organization or remind stakeholders that the organization has done good n simple terms whether the organization feels responsible or not. When an organization uses the strategy of ingratiation, it feels a certain amount of responsibility for the crisis but tries to make stakeholders not feel very negative about the crisis situ ation by reminding them of the Corrective action from simple compensation actio n because it is an effort to prevent the crisis from occurring again. A full apology A defensiv e response such as denial or minimizing might work most effectively when public perception of crisis responsibility is weak; however, if such crises have occurred in the past, the perception of crisis responsibility is intensified. In those cases, Coombs ( 1998) suggested that organizations with a poor performance history that are experiencing a crisis with an internal locus of control should respond with mortification. This manner of response

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42 responsibility strengthens, the threat of image damage becomes stronger. This means that crisis managers need to utilize more accommodative s trategies. Accommodative strategies emphasize image restoration which is what is increasingly needed as image damage worsens (Benoit, 1997). Study results of image restoration theory w as applied in order to understand the strategies used by politicians ( Benoit, 2004; Len Ros & Benoit, 2003), corporate entities (Benoit & Brinson, 1994; Benoit & Pang, 2008; Cowden & Sellnow, 2002) and prominent individuals (Benoit, 1997; Benoit & Brinson, 1999). More and more nations practice image cultivation, however, it is still rare for a country to try to restore a tarnished national image through crisis management. Few studies have examined repair strategies by nations ( Peijuan, Ting, & Pang, 2009; Zhang & Benoit, 2004). Peijuan et al. (2009) studied how China managed in strategies such as denial, bolster ing, and attacking the accuser, which resembled those that Saudi Arabia used when it was accused of supporting terrorism and failing to support a possible U.S. attack on Iraq (Zhang & Benoit, 2004). However, China could not sustain the use of these strateg ies because mounting evidence compelled it to engage in corrective action. When China showed its sincerity in correcting the problem, it helped China repair its image. Benoit (2004) argued that a firm commitment to correct the problem is a very important component in image restoration How different is nation image restoration compared to political,

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43 corporate, or entertainment image restoration ? Benoit (1997) argued that nations, like political image restoration are less likely to use mortification because it came with reputational repercussions. Hypotheses and Research Questions This study primarily focuses on the impact of transnational crises on country reputation, as well as the strategic response of the country where the multinational corporations (MNC ) facing the crisis is headquartered. Additionally, it examines how salience of association between the home country and the MNC influences foreign intentions. Because this study is exploratory, it investigates a field where lack s relevant literature regarding image restoration strategy deployed by countries, corrective action, and denial derived from the two previous studies (see Peijuan et al. 2009 ; Zhang & Benoit, 2004). Based on the literature review, the res earcher developed the following hypotheses and research questions to test for statistical analysis. H1: A home country having a good reputation will be less influenced by its MNC transnational crisis. H 1A : A home country having a good reputation will predict higher perceived country reputation than a home country with a bad reputation H 1B : A home country having a good reputation will predict more positive attitudes home country with a bad reputatio n H 1C : A home country having a good reputation will predict higher purchase s than a home country with a bad reputation H 1D : A home country having a good reputation will predict higher perceived corporate reputation facing a transnational crisis than a home country with a bad reputation H 1E : A home country having a good reputation will predict higher purchase intention s of products of the company facing a crisis than a home country with a bad reputation

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44 H2: A company having low country of origin salience will be less influenced by its transnational crisis. H 2A : A company having low country of origin salience will predict higher perceived country reputation than a company having high country of origin sali ence. H 2B : A company having low country of origin salience will predict more positive of origin salience. H 2C : A company having low country of origin salience will predict higher pu country of origin salience. H 2D : A company having low country of origin salience will predict higher perceived corporate reputation facing a transnational crisis than a company havi ng high country of origin salience. H 2E : A company having low country of origin salience will predict higher purchase intentions of product of the company facing a crisis than a company with high country of origin salience. H3: A country using an image res toration strategy will have more favorable influence than a country not using an image restoration strategy. H 3A : A country using an image restoration strategy will predict higher perceived country reputation than a country not using an image restoration s trategy. H 3A 1 : A country using an image restoration H 3B : A country using an image restoration strategy will predict more positive atti image restoration strategy. H 3B 1 : A country using an image restoration H 3C : A country using an image restoration strategy will predict higher purchase image restoration strategy. H 3C 1 : A country using an image restoration

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45 H 3D : A country using an image restoration strategy will predict higher perceived company reputation in the face of a crisis than a country not using an image restoration strategy. H 3D 1 : A country using an image restoration predict higher perceived company reputation during a crisis than a country using H 3E : A co mpany using an image restoration strategy will predict higher purchase intention s of products of the company facing a crisis than a country not using an image restoration strategy. H 3E 1 : A company using an image restoration will predict higher purchase intention s of products of the company facing a crisis than a RQ1: Is there a three way interaction effect among level of country reputation, country of origin salience, and types of image restoration strategy that influences the attitudes and behavioral intentions of the recipients ? RQ2: Are there two way interaction effect s among level of country reputation, country of origin salience, and types of image restoration strategy?

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46 CHAPTER 3 METHODOLOGY Pilot Study A pilot study took place in June 2011 to evaluate the effectiveness of experimental manipulation of the independent variables. The experiment was launched using the Qualtrics software program and disseminated among 129 undergraduate students enrolled in summer semester in College of Journalism and Communications at a large southeastern university with the advantage of earning extra credits for the courses they are enrolled. Because the final study was planned to recruit participants at the same university during fall semester, using the participants with same characteristics for the pilot study was appropriate. The Qualtrics program was set to randomly provide each of the twelve different experimental blocks in equal proportion. One o f the purpose s of the pilot study was to determine which country for representing good country reputation between Japan and South Korea. Based on the CountryRep SM score Japan was evaluated to have more favorable reputation than South Korea. However, the researcher was concerned if the deadly tsunami, the worst earthquake disaster in its modern history occurred in Japan in March 2011, would have influenced the reputation of Japan and undergraduate students that are samples for this research may not have favorable reputation any more. In order to choose a country that also can represent good country reputation from the same region, South Korea was selected. It was found th at Japan still had higher country reputation than South Korea with significant difference, therefore, the researcher decided to keep the original selection of Japan and China, as representing good and bad country reputation. Results of the manipulation che ck from the pilot study showed that the manipulation for level of country reputation was successful. The manipulations for country of origin salience and types of image restoration strategy were also working, but the difference between groups was not

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47 stati stically significant. As a result, the researcher asked the writers for stimuli materials re write the stimuli materials with more sentences of using image restoration strategy, and included more cues for country of origin salience. Result of the final stu dy manipulation can be found in Chapter 4 and details of the experimental manipulations can be found in Appendix B. Main Study Design The objective of this study is to analyze the relationship among the three main variables use of image restoration strat egy, level of country reputation, and level of country corporation association exposed to news articles about transnational crises or cross national conflict shifts. In order to test for causal relationships, an experimental study was conducted by randomly assigning participants to one of eight groups. The experiment represents a two ( country of origin salience: high vs. low) x two (level of country reputation: high vs. l ow) x three (use of image restoration strategy: corrective action vs. denial vs. not employing image restoration strategy ) between subject post test only design. The data were collected using a questionnaire including post test questions. Subjects answered these after reading news articles worldwide crisis. A Multi Analysis of Variance (MANOVA) was used to analyze the interaction effects and Analysis of Variance (ANOVA) was used to analyze the main effects Participants On the basis of convenient sampling, undergraduate students attending a large southeastern university were recruited, and extra credits were given for their participation in data collection. A total 361 p articipants were recruited from two large public rel ations classes two advertising classes and one telecommunication class.

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48 According to Cook and Campbell (197 9 ), university students are considered to make for an acceptable sample and allow samples to remain as homogeneous as possible. Using university st udents for this study is appropriate because they actively participate as agenda builders through online social media and can be regarded as one important public that can influences an (Bae & Cameron, 2006). In addi tion, Basil (1996) argued that using college students as a sample is appropriate when researching a hypothesized relationship among variables. Furthermore, it has been claimed that the age of the respondents did not influence the outcome, indicating that t he perception of national image by older adults agreed with those of students (Terracciano & McCrae, 2006). A meta analysis of country of origin (COO) effects (Peterson & Jolibert, 1995) also found that effect sizes for studies using students did not vary appreciably on quality/reliability perceptions from those in studies using nonstudents. Participants were randomly assigned to each cell with the randomization function of Qualtrics. The participants were randomly assigned to 2 x 2 x 3 treatment conditions such as (use of image restoration strategy: corrective action vs. denial) x (level of country reputation: high vs. low) x ( country of origin salience : high vs. low). Because this experiment was meant to test the effect of using an image restoration strate gy in relation to transnational crisis news on the attitudes of people reading the message for the first time, no control group was used. Procedure The experiment was conducted at the research laboratory of the College of Journalism and Communications at a large southeastern university Upon arrival, participants review ed the IRB consent form. If they agree d with this document, they were assigned to a randomized condition of the experiment.

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49 Participants read two of twelve different versions of fictitious news report s typeset in newspaper format, about a transnational crisis. They were asked to read the news article s carefully, and respond to questions which measured their attitudes toward a multinational corporation facin g a transnational crisis and the home country of the MNC Participants were In an agreement with the lecturers of se students who participate d After participants completed the experiment, they were debriefed. The completed data were gathered and coded for statistical analyses. Research Stimuli Choosing c ountries and c ompanies To manipulate the independent variable of level of country reputation, Japan was chosen as a country with a good reputation, whereas China was selected as a country with a bad reputation. According to the CountryRep SM 2010 Report by Reputation Institute, Japan scored 66.23 points and had a rankin g of 13 th place, while China scored 38.43 points and ranked third from last on the list. Though Japan is not among the top 10 countries on the overall CountryRep SM score, the nation is perceived as being the strongest nation in three of four areas in the A dvanced Economy was among the top five when general public in the G8 countries were surveyed about their perception of which countrie s are the most attractive to buy products and services from. However, China is known to have one of the lowest country reputations, since in crisis involving worldwide recalls of Chinese products in 2007. This recall crisis was analyzed by Barney and Zhang (2008), who concluded that the crisis was not actually caused by the

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50 defectiveness of Chinese products. Instead, they said the outrage may have been influenced by the national reputation of China. The two countries were chosen from one continent (Asia) so that they would have similar cultural background. This is important because factors such as differing cultural perceptions may interfere in such a study if two countri es are chosen from different regions. Thus, this study chose Japan and China because they are from the same region and have similar cultural backgrounds but differing reputations For the companies used in the research stimuli, fictitious brand names were created for existing attitudes toward real companies. Real brand names with already established reputations may interact with the country of origin and affect the perceptions of participants. To manipulate companies to have high country of origin salience a screening process was designed for a pre test. Fourteen fictitious company names were created to sound similar to the language of each country ( seven for Japanese companies and seven for Chinese companies) These company names were presented to a group of 26 undergraduate students in an upper level public relations class in list form. Students were instructed to check a box indicating their feelin gs about how strongly they felt each company name sounds like the name of a Japanese or Chinese company. Among the fourteen names, the two names with the highest ratings were selected to use as the name for the fictitious Japanese company (Mitsukoshi) and the fictitious Chinese company (HongXing). On the other hand, the brand names of companies having low country of origin salience were created with nonsense syllables such as GIW. Crafting n ews s tories Two fictitious news stor ies w ere written by a former jo urnalist with extensive news writing

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51 who had worked as a news reporter in the past Twelve versions were created in order to manipulate the main independent variabl e: 1) a home country with a good reputation issued a defensive response when its MNC with a high country of origin salience faced a transnational crisis ; 2) a home country with a good reputation issued an apologetic response when its MNC with a high coun try of origin salience faced a transnational crisis ; 3) a home country with a good reputation did not employ any kind of image restoration strategy and did not respond when its MNC with a high country of origin salience faced a transnational crisis; 4 ) a h ome country with a good reputation issued a defensive response when its MNC with a low country of origin salience faced a transnational crisis ; 5 ) a home country with a good reputation issued a n apologetic response when its MNC with a low country of origin salience faced a transnational crisis ; 6) a home country with a good reputation did not employ any kind of image restoration strategy and did not respond when its MNC with a low country of origin salience faced a transnational crisis; 7 ) a home country with a bad reputation issued a defensive response when its MNC with a high country of origin salience faced a transnational crisis ; 8 ) a home country with a bad reputation issued an apologetic response when its MNC with a high country of ori gin salience faced a transnational crisis ; 9) a home country with a bad reputation did not employ any kind of image restoration strategy and did not respond when its MNC with a high country of origin salience faced a transnational crisis; 10 ) a home countr y with a bad reputation issued a defensive response when its MNC with a low country of origin salience faced a transnational crisis ; 11 ) a home country with a bad reputation issued a n apologetic response when its MNC with a low country of origin salience f aced a transnational crisis; 12) a home country with a bad reputation did not employ any kind of image restoration strategy and did not respond when its MNC with a high country of origin salience faced a transnational crisis

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52 There were a total of twelve n ews stories. These stories were formatted to look like a printout of an online news article. For credibility, all articles were represented as coming from The New York Times, the largest metropolitan newspaper in the United States. Questionnaires The quest ionnaires first measured attitudes towards multinational corporations in general to use as a covariate in statistical analysis. A articles t he next question test ed the manipulation check of each independent variable To ascertain whether the experimental manipulation of responses was effective, first, subjects were asked to rate This was measured by Likert scale (1 = strongly disagree, 4 = neither agree nor disagree, 7 = strongly agree). The next question checked manipulation of country o f origin salience by asking participants how closely they relate the company in the news articles with its country of origin, and this question was also measured by a Likert scale. Then participants were asked to evaluate the crisis situation was a denial or an apology. This question was asked using a semantic differential scale (1 = a denial; 7 = an apology). Subjects were asked to rate whether the news stor ies was a deni al or an apology. This question was asked using a semantic differential scale (1 = a denial; 7 = an apology). S ubjects were then asked to measure their perceptions of each country and company, and their attitudes and purchase intentions toward the company and toward the product. See appendix C for a copy of the questionnaire.

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53 Independent Variables Level of country reputation Country reputation is used in this study as both an independent and a dependent variable. When manipulated as an independent variable, two different countries, one with a good (Japan) and one with a bad (China) reputation, were chosen for research stimuli based on the rankings of CountryRep SM 2010 Report by Reputation Institute Use of image restoration strategy Use of image restoration strategy was manipulated by describing in the research stimuli. Three image restoration strategies corrective action, denial and use of no image restoration strategies were used to manipulate the content of news articles separately. Below are the example s of sentences that were used to manipulate each strategy within the stimuli materials. No response: While there are increasing numbers of people questioning the safety of products made in China, the Chinese government has not yet rel eased an official statement nor scheduled a press conference regarding the current situation. However, while public opinion toward China and the quality of its products is getting worse, the Chinese government has not responded to the current product recal l situation so far. Denial : Mexican reports about the alleged incidents with the microwaves are overstated to consumers of Chinese pro ducts worldwide to know that our manufacturing

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54 their res pective countries and deny the allegations of a national manufacturing monitored protocols for production of electronics secure processes and any malfunction would not be related to their country of Corrective action : cause of the problems, I want to assure consumers of Chinese products worldwide that facilities to make sure proper quality control methods are in place. We want to tuation we would like to announce that the Chinese government will be issuing a nationwide inspection of electronics manufacturing The Chinese government has contributed $10 million to the developing investigation of what caused the explosions. It has accepted responsibility for the explosions and will initiate legislation for more critical product regulations. Country of origin salience In this study, country of origin salience Roth, Diamantopo ulos, & Montesinos, 2008, p. 584). Country of origin salience was manipulated in three ways. First, the fictitious name s for the companies with high country of origin salience were while the fictitious name for the companies with low country of origin salience were chosen from a list of nonsense syllables. Based on the screening process, two fictitious names for companies having a high country of origin salience

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55 were created; Mitsukoshi for a fictitious Japanese company, and HongXing for a fictitious Chinese company. GIW was used for both Japanese and Chinese companies having a low country of origin salience. were selected to manipulate. Each story refers to a company spokesperson in the United States where the company faces a crisis situation. A company with high country of origin salience ha d spokespeople with names reflective of its home country; however, an English name was created for a spokespe rson speaking for a company with low country of origin salience. Among the 10 fictitious personal name and Lin WeiLing was chosen as a fictitious Chinese spokespe companies with high country of origin salience. In addition, James Reed was selected as an of origin salience. the same idea. Participants received a sheet with background information about the company before reading the news articles. For companies with high country of origin salience, this sheet described CEOs of the regional headquarters as someone from the home country. These people were given either the companies with low country of origin salience, an English name was created to give the impression these individuals were American headquarters. Lastly, a production site was included in manipulating the country of origin salience. Companies with high country of origin salience were described as having production lines in their home countries, leaving the regional headquarte rs in North America in charge of only sales and management. However, for companies with low country of origin salience, it was stated that

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56 the company built a production facility in the United States which was not only in charge of sales and management, bu t also of the production facility. Dependent Variables Perceived c ountry r eputation There are several measurement scales used to evaluate country reputation. Because this study focused on the industrial/economic dimensions of country reputation rather than on the 10 items that were modified from GCA (General Country Attribute) in Parameswaran and Pisharodi (1994). This modified index was measured on a seven point Li kert scale, which ranged 10 statements about the country at hand: 1) people are well educated; 2) places emphasis on technical/vocational training; 3) people are hardworking; 4) people are creative; 5) people are friendly and likeable; 6) technical skills of workforce are high; 7) friendly toward my country in international affairs; 8) actively participates in international affairs; 9) people are motivated to raise living standards; and 10) people are proud to achieve high standards. Corporate reputation C orporate reputation (CR) was measured by six items that were modified from the Harris Fombrun Reputation Quotient (Fombrun & Gardberg, 2000). As in the CR ind ex, a seven point Likert type scale was used were asked to rate their agreement with six statements about the company at hand: 1) have good feeling about the company; 2) trust the company, 3) offers high quality products/services; 4) is ethical; 5) strong prospects for future growth; and 6) meeting global standards.

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57 Attitude towards products Attitude A ttitude towards products ral products of a country to which they will be exposed in the news story. Attitudes toward products (ATP) were measured by six items that were modified from GPA (General Product Attributes) in Parameswaran and Pisharodi (1994) using a seven point semantic differential scale (from 1 = strongly disagree to 7 = strongly agree): 1) products are innovative 2) good looking (stylish), 3) good performers (reliable), 4) in need of frequent repairs (heavy maintenance), 5) long lasting (durable), and 6) (it is?) eas y to get service in United States. Product purchase intention Purchase intention purchase was measured by using a semantic differential scale based on Kang and Yang (2010) Questionnaires asking how likely the participants would be to behave a certain way measured the likelihood (from 1 = very unlikely to 7 = very likely ) of each of the following: personal product purchase intention in si x months, satisfaction, and positive word of mouth intention. Data Analysis The data collected will be analyzed using the PASW 18.0 for Windows. Descriptive statistics w ill be calculated to study the sample composition, and multivariate analysis of variance (MANOVA) will be performed to identify group differences that resulted from the treatment factors.

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58 CHAPTER 4 RESULTS This chapter presents the results of the experiment outlined in Chapter Three The chapter begins with a review of demographic data, followed by describing manipulation checks for the independent variables and reliability checks for the dependent variables and results of hypotheses testing. It concludes with reports of additional findings. All testing and results were conducted at the 95% confidence level or ( p < .05). Sample PASW version 18, formerly SPSS, statistical software was used for compilation and statistical analysis of data. Data were collected through the online Qualtrics survey software program, downloaded into an Excel file and converted into PASW. A total of 361 participants ( N = 361) consisted of 73 male (20.2 %) and 288 female (79.8%) subje cts. The median age for participants across all experimental blocks was 20 years old, with the youngest participants at 18 and the oldest at 40 years old. Three hundred thirty seven (93.7%) of these participants were between the ages of 18 to 21 years old, and 21 (5.8%) w ere between 22 to 25 years old. Almost half of the participants (N = 160, 44.3%) were junior in their education level. Seventeen participants were freshman (4.7%), 87 (24.1%) were sophomore, and 97 (26.9%) were senior as described in Table 4 1. Two hundred forty one (66.8%) were white, 71 (19.7%) were Hispanic, 26 (7.2%) were African American, and 15 (4.2%) were Asian participants as reported.

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59 With the purpose of improving external validity, t he demographic of the sample was compared to the undergraduate population of the university where participants were recruited based on the institution's fall enrollment reporting 1 as of October 15, 2011. P lease see Table 4 2 Manipulation Check for Independent Variables Country Reputation For a manipulation check of country reputation, participants were asked two items country in the news articles as having a good reputation seven point bipolar rating scales were used, ranging from 0 (strongly disagree) to 7 (strongly agree) for both question (a) and question (b). There was correlation between the two items signific ant at the p < .01 level (2 tailed). As shown in Table 4 5 for q uestion (a), the M ANOVA for the mean scores of good versus bad country reputation showed a significant difference ( M goodCR = 5.08, M badCR = 3.40, F (1,359) = 302.05 p < .01). The M ANOVA for the mean scores of q uestion (b) also showed a significant difference between good and bad country reputation ( M goodCR = 5.15, M badCR = 3.29, F (1,359) = 351.28 p < .01). Participants who read news articles about Japan rated the country as having good country reputation, while those who read news articles about China rated the country as having bad country reputation. Manipulation of level of country reputation did not have interaction effects with other independent variables (see Table 4 4), t hus it is assumed that the manipulation for country reputation was successful. 1 http://www.ir.ufl.edu/OIRAPPS/commondataset/b_enrollment_v1.aspx

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60 Country of origin S alience For a manipulation check of country of origin salience participants (N = 361) were asked two item How close do you relate the company in the news articles with its country of How close do you think that others would relate the company in the news articles with its country of A seven point bipolar rating scales were used, ranging from 0 (strongly disagree) to 7 (strong ly agree) for both question (a) and question (b). There was correlation between the two items significant at the p < .01 level (2 tailed). As shown in Table 4 6 for question (a), the M ANOVA for the mean scores of high versus low country of origin salience showed a significant differences between the two means ( M highCOS = 5.06 M lowCOS = 4.43 F (1,359) = 19.86 p < .01). The M ANOVA for the mean scores of q uestion (b) also showed a significant difference between the two means ( M highCOS = 5.01, M lowC OS = 4.49, F (1,359) = 12.3 9, p < .01) and manipulation of country of origin salience did not have interaction effects with other independent variables (see Table 4 4). Thus, it is assumed that subjects who read news articles about a crisis of a company which has high country of origin salience strongly associated the company with its home country, while subjects who read news articles about a crisis of a company which has low country of origin salience did not clearl y associated the company with its home country. Therefore, manipulating country of origin salience was successful. Types of Image R estoration Strategy For a manipulation check of types of image restoration strategy, participants were measured with two items to access their perception of each type of image restoration strategy: (a) country of origin responding to the would think the governmen country of origin A seven point bipolar rating scales were used

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61 for both two questions ranging from zero (a denial) to seven (a corrective action). There was correlation between the two items significant at the p < .01 level (2 tailed). As shown in Table 4 7 for q uestion (a), t he ANOVA for the mean scores showed a significant difference among the three means ( M denial = 2.52, M no response = 3.73, M corrective action = 5.20, F (2,358) = 87.95 p < .01). The Scheffe post hoc test showed a significant mean difference existed among all three means ( M denial M no response = 1.21 M denial M corrective action = 2.68 M no response M corrective action = 1.47, p < .01). For q uestion (b), the M ANOVA for the mean scores also showed a significant difference among the three means ( M denial = 2.46, M no response = 3.69, M corrective action = 5.20, F (2,358) = 105.59 p < .01). The Scheffe post hoc test showed a significant mean difference among the types of image restoration strategy as well ( M denial M no response = 1.23, M denial M corrective action = 2.82, M no response M corrective action = 1.59, p < .01). Manipulation of types of image restoration strategy did not have interaction effects with other indepen dent variables (see Table 4 4), t hus, it is assumed that subjects clearly matched the image restoration strategy employed by the country in the news articles, and the manipulation was successful. Reliability Check for Dependent Variables 8 shows the reliability results for five dependent variables lpha values were more than 7 0 In particular, purchase intentions about the ( 91 ), perceived company reputation ( 90 ), and ( .9 3 ) were excellent. Therefore, all items had alphas above .70 and were therefore excellent, according to

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62 Hypotheses Testing Test of Hypothesis 1 Given that the results of the r esearch q uestions showed that there was no three way interaction effect, and no two way interaction effect between level of country reputation and country of origin salience level o f country reputation and use of image restoration strategy, and country of origin salience and use of image restoration strategy, the main effects of each independent variable were tested. Hypothesis 1 posited that a country of origin that has high level of country reputation will of variance (MAN C OVA) was used to test this hypothesis. Linear combinations of all dependent variables were considered together (Table 4 9 ), and the result showed that there was a significant p < .01). Thus, the first hypothesis was supported. Hypothesis 1A H ypothesis 1A home country with c ountry reputation will predict higher perceived country reputation (CR) than a country of origin with bad country reputation. As shown in Table 4 10 results of a mean difference test showed that a country of origin with good country reputation ( M goodCR = 4.94, SD = 1.01) led to higher perceived country reputation [ F (1,359) = 6.77 p = .01) than a country of origin with bad country reputation ( M badCR = 4.68, SD = .90) on the Hypothesis 1B Hypothesis 1B stated that a country of origin having good country reputation will predict of origin with bad country

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63 reputation. Table 4 10 shows that there was a significant difference [ F (1,359) = 19. 90 p = 00 ] between a country with good reputation ( M goodCR = 4.52, SD = 1.14) and a country with bad reputation ( M badCR = 4.01, SD = 1.02) Hypothesis 1C Hypothesis 1C predicts that a country of origin having good reputation will result in of origin having bad reputation. Table 4 10 shows that there was a significant difference [ F (1,359) = 6.15, p = 01 ] between a country with good reputation ( M goodCR = 4.56, SD = 1.51) and a country with bad reputation ( M badCR = 4.20, SD = 1.25). Hypothesis 1D Hypothesis 1D predicts that a country of origin having good reputation will result in ositive company reputation toward its MNC facing the crisis than a country of origin having bad reputation. As shown in Table 4 10 there was a significant difference [ F (1,359) = 4.78 p =. 03 ] between a country with good reputation ( M goodCR = 3.85 SD = 1. 30 ) and a country with bad reputation ( M badCR = 3.56 SD = 1.2 2 ). Hypothesis 1E Hypothesis 1E posited that a country of origin having good reputation will predict n a country of origin having bad reputation. Table 4 10 shows there was a significant difference [ F (1,359) = 4.83, p =. 03 ] between a country with good reputation ( M goodCR = 2.97, SD = 1.34) and a country with bad reputation ( M badCR = 2.68, SD = 1.15). Therefore H 1E was supported. Test of Hypothesis 2 The second h ypothesis stated that a multinational corporation having low country of origin salience will be less influenced by its transnational crisis. The MANOVA result (Table 4 11 )

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64 showed that there was no significant difference between a company with high country of origin salience and a company with low country of origin salience on the attitudes and behavioral intentions of the recipients da=.9 8 F ( 5, 345 ) = 1.20 p = 66 ). Therefore H ypothesis 2 was not supported and each independent variable was not tested Similarly, h ypothes e s 2A 2B 2C 2D 2E were not supported. Test of Hypothesis 3 The third h ypothesis posited that there would be more favorable influence if a country uses an image restoration strategy when a multinational corporation that has its headquarter in that country faces a transnational crisis in host countries. A multivariate analysis of variance (MANOVA) was used to test this hypothesis. Linear combinations of all dependent variables were considered together (Table 4 9 ), and the result showed that there was significant difference between a country using an image restoration strategy a nd a country which is not employing an image restoration strategy [ 74 F (10, 690) = 11.44, p < .01 ). Lambda was significant, each dependent variable was tested. Hypothes i s 3A and 3A 1 Hypothesis 3A stat of origin employing an image restoration strategy will predict higher perceived country reputation (CR) than a country of origin not employing an image restoration strategy As shown in Table 4 1 2 results of a mean difference test showed that a country of origin using an image restoration strategy of corrective action ( M corrective action = 5.12 SD = .88 ) led to higher perceived country reputation [ F ( 2,358) = 13.31 p = 00 ) than a country of origin not employing an image restoration strategy ( M no response = 4.50 SD = .9 1). This result was confirmed by a post hoc test performed at p < .05 level. Therefore h ypothesis 3A is supported.

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65 Hypothesis 3A 1 of origin employing an image restoration strategy of corrective action will result in higher perceived country reputation (CR) than a country of origin employing an image restoration strategy of denial. As shown in Table 4 1 2 results of a mean difference test showed that a country of origin usi ng an image restoration strategy of corrective action ( M corrective action = 5.12, SD = .88) had higher perceived country reputation [ F (2,358) = 13.31, p < .01) than a country of origin employing an image restoration strategy of denial ( M denial = 4.83, SD = .99). This result was confirmed by a post hoc test performed at p < .05 level. Therefore h ypothesis 3A 1 is supported. Hypothes i s 3B and 3B 1 Hypothesis 3B stated that of origin employing an image restoration strategy will predict country of origin not employing an image restoration strategy Both of the two groups of a country using either a corrective action or a denial had higher mean score on the attitudes toward M corrective action = 4.29, SD = 1.09; M denial = 4.29, SD = 1.20) than a country not employing an image restoration strategy ( M no response = 4.21, SD = 1.10) ; however, a s shown in Table 4 1 2 there was no significant difference [ F ( 2,358 ) = .246 p =. 78 ] Therefore h ypothesis 3B is not supported. Hypothesis 3B 1 posited that a country employing an image restoration products than a co untry using a denial, however, there was no significant difference [ M corrective action = 4.29, SD = 1.09; M denial = 4.29, SD = 1.20, F (2,358) = .246, p = 78 ]. Thus h ypothesis 3B 1 was not supported. Hypothes i s 3C and 3C 1 Hypothesis 3C predict ed that a country of origin using an image restoration strategy will of origin not

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66 using an image restoration strategy Table 4 1 2 shows that a country not employing any image restoration strategy ( M no response = 4.46, SD = 1.35) scored higher on purchase intentions toward M corrective action = 4.27, SD = 1.51) or denial strategy ( M denial = 4.41, SD = 1.39). However, there was no significant difference among the groups [ F (2,358) = .59, p =. 56 ] and this was confirmed by a post hoc test. Hypothesis 3C 1 posited that a country using corrective action strategy in crisis situation will predict higher pur denial strategy. Contrary to the H 3C 1 a country using a denial strategy ( M denial = 4.41, SD = 1.39) had higher mean score than a country using a corrective action strategy ( M corrective action = 4.27, SD = 1.51) and the mean difference was not statistically significant [ F (2,358) = .59, p =. 56 ] Therefore h ypothesis 3C 1 is not supported and not supported in reverse case. Hypothes i s 3D and 3D 1 Hypothesis 3D predicts that a country of origin employing an image restoration strategy attitude toward the company facing the crisis than a country of origin not using an image restoration strategy As shown in Table 4 1 2 th ere was a significant difference [ F ( 2 ,35 8 ) = 15.64 p =. 00 ] between a country using an image restoration strategy of corrective action ( M corrective action = 4.17, SD = 1.22 ) and a country not using any image restoration strategy ( M no response = 3.67, SD = 1.14 ). A country using corrective action strategy had image restoration strategy, and a post hoc test was performed and confirmed this result at p < .05 level. Hypothesis 3D 1 posited that a country using corrective action strategy will have more positive attitude toward the company than a country using denial strategy. Table 4 1 2 shows that a country using corrective action strategy ( M corrective action = 4.17, SD = 1.22) had higher mean

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67 score than a country using denial strategy ( M denial = 3.29, SD = 1.30), and a post hoc test also confirmed that the mean score difference was statistically significant [ F (2,358) = 15.64, p = 00 ] Hypothes i s 3E and 3E 1 Hypothesis 3E posited that a country of origin using an image restoration strategy will a country of origin not employing any image restoration strategy Tabl e 4 1 2 shows a country using denial strategy had higher mean score ( M denial = 3.10, SD = 1.46) than a country not using an image restoration strategy ( M no response = 2.73, SD = 1.12) and a post hoc test confirmed that the mean difference was statistically significant [ F ( 2 ,35 8 ) = 4.16 p =. 02 ]. Hypothesis 3E 1 stated that a country using corrective action strategy will have higher However, as shown in Table 4 1 2 a country using denial strategy had higher mean score ( M denial = 3.10, SD = 1.46) than a country using corrective action strategy ( M corrective action = 2.65, SD = 1.12), and the mean difference was statistically significant [ F (2,358) = 4.16, p =. 02 ]. Theref ore, H 3E 1 was not supported Research Question 1 This research question asked about a three way interaction effect among level of country reputation, country of origin salience, and types of image restoration strategy on the attitudes and behavioral changes of the subjects. The results of MANOVA (Table 4 9 ) showed no three each dependent variable was not tested. Resear ch Question 2 The second research question asked if there are any two way interaction effects between level of country reputation, country of origin salience, and types of image restoration strategy on

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68 the attitudes and behavioral changes of the participan ts. The MANOVA result (Table 4 7) showed that there was no interaction effect between country reputation and level of country of origin salience F (5, 345) = 1.48, p = .20]. The MANOVA result (Table 4 7) also showed that there was no interaction effect between country reputation and level of country of origin on the attitudes and F (10, 690) = 1.47, p = .15. Lastly, there was no interaction effect between country of origin salience and use of image restoration F (10, 690) = 1.05, p = .40].

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69 Table 4 1. Sample demographic profiles Frequency Percentage Gender Male 73 20.20% Female 288 79.80% Age 18 21 years 337 93.40% 22 25 years 21 5.80% 26 30 years 3 .80% Education Freshman 17 4.70% Sophomore 87 24.10% Junior 160 44.30% Senior 97 26.90% Ethnicity African American (non Hispanic) 26 7.20% White (non Hispanic) 241 66.80% Hispanic 71 19.70% Asian or Pacific Islander 15 4.25% Native American or Alaskan Native 1 .30% Other 7 1.90% Total 361 100.00% Table 4 2. Comparison ratio of sample and population Percentage of Sample Percentage of Population Gender Male 20.20 % 43.80 % Female 79.80 % 56.20 % Ethnicity African American 7.20 % 8.68 % White 66.80 % 58.89 % Hispanic 19.70 % 17.38 % Asian or Pacific Islander 4.25 % 8.38 % Native American or Alaskan native .30 % .33 % Other 1.90 % 2.84 %

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70 Table 4 3. Experimental block frequencies Type Block Description Frequency Valid % Cumulative % Block 1 High CR*Denial*High COS 30 8.3 8.3 Block 2 High CR*No Response*High COS 29 8 16.3 Block 3 High CR*Corrective Action*High COS 30 8.3 24.7 Block 4 High CR*Denial*Low COS 31 8.6 33.2 Block 5 High CR*No Response*Low COS 31 8.6 41.8 Block 6 High CR*Corrective Action*Low COS 30 8.3 50.1 Block 7 Low CR*Denial*High COS 30 8.3 58.4 Block 8 Low CR*No Response*High COS 31 8.6 67 Block 9 Low CR*Corrective Action*High COS 29 8 75.1 Block 10 Low CR*Denial*Low COS 30 8.3 83.4 Block 11 Low CR*No Response*Low COS 30 8.3 91.7 Block 12 Low CR*Corrective Action*Low COS 30 8.3 100 Total 361 100 100 Table 4 4. Multivariate tests for manipulation check of country reputation (CR), country of origin salience (COS), and types of image restoration strategy (IRS) Effects Wi l F H df Error df P value CR 0. 46 68.58 6 34 4 .00** COS 0. 92 4.97 6 34 4 00** IRS 0. 61 16.06 1 2 6 88 .00** CR*SCO 0. 98 .94 6 34 4 47 CR*IRS 0. 96 1.29 12 688 22 SCO*IRS 0.9 4 1. 75 1 2 6 88 53 CR*SCO*IRS 0. 98 .51 1 2 6 88 91 Table 4 5. Manipulation check for country reputation M S.D. F df1 df2 p value Country Reputation Respondents' recognition Good 5.08 0.9 0 302 05 1 359 .00** Bad 3.4 0 0.95 Other's recognition Good 5.15 0.98 3 51.28 1 359 .00** Bad 3.29 0.93

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71 Table 4 6. Manipulation check for country of origin salience M S.D. F df1 df2 p value country of origin salience Respondents' recognition High 5.06 1.32 19.86 1 359 .00** Low 4.43 1.39 Other's recognition High 5.01 1.36 1 2.39 1 359 .0 0 ** Low 4.49 1.43 Table 4 7. Manipulation check for types of image restoration strategy M S.D. F df1 df2 p value Image restoration strategy Respondents' recognition Denial 2.52 1.62 87.95 2 358 .00** No Response 3.73 1.55 Corrective Action 5.2 1.49 Other's recognition Denial 2.46 1.6 105.59 2 358 .00** No Response 3.69 1.38 Corrective Action 5.28 1.48 Table 4 8. Measurement reliability for all items Variable Number of items MNC attitude 6 70 Attitude toward Country 10 .89 Country Product Attitude 6 .85 Country Purchase intention 4 .91 Attitude toward Company 5 .9 0 Company Product purchase intention 4 .93

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72 Table 4 9. Multivariate tests for country reputation, country of origin salience, and types of image restoration strategy Effects Wi l F H df Error df P value CR 0.9 4 4.23 5 345 .00** SCO 0.98 1. 20 5 345 .3 1 IRS 0. 74 11 44 10 690 .00** CR*SCO 0.98 1. 48 5 345 20 CR*IRS 0.9 6 1.47 10 690 15 SCO*IRS 0.97 1. 05 10 690 40 CR*SCO*IRS 0.96 1. 44 10 690 16

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73 Table 4 10 Results of between subjects test Source Dependent variable df Mean Square F p value CR Perceived country reputation 1 5.93 6.88 .01 ** Attitudes toward products of the country 1 23.20 19.69 .00 ** Product purchase intentions of the country 1 11.78 6.14 01** Company reputation 1 7.51 5.10 .0 3** Product purchase intentions of the company 1 7.48 5.01 03** SCO Perceived country reputation 1 .17 19 66 Attitudes toward products of the country 1 1 .86 1.58 .21 Product purchase intentions of the country 1 1 14 .59 44 Company reputation 1 30 21 65 Product purchase intentions of the company 1 2.31 1 .5 4 22 IRS Perceived country reputation 2 11 45 13 27 .0 0** Attitudes toward products of the country 2 .26 .22 .80 Product purchase intentions of the country 2 1. 15 60 55 Company reputation 2 23.02 15 60 .00 ** Product purchase intentions of the company 2 6.44 4.31 01** CR*SCO Perceived country reputation 1 13 15 70 Attitudes toward products of the country 1 1.98 1.68 .20 Product purchase intentions of the country 1 64 33 57 Company reputation 1 1.72 1 17 .28 Product purchase intentions of the company 1 2 40 1. 6 0 21 CR*IRS Perceived country reputation 2 16 19 83 Attitudes toward products of the country 2 2.01 1.71 .18 Product purchase intentions of the country 2 4.39 2 29 10 Company reputation 2 .63 43 65 Product purchase intentions of the company 2 3.54 2.37 10 SCO*IRS Perceived country reputation 2 31 36 70 Attitudes toward products of the country 2 .02 .02 .98 Product purchase intentions of the country 2 1. 57 82 44 Company reputation 2 1 58 1.07 34 Product purchase intentions of the company 2 4 44 2.97 05** CR*SCO*IRS Perceived country reputation 2 37 43 65 Attitudes toward products of the country 2 1.21 1.03 .36 Product purchase intentions of the country 2 3.00 1. 56 .2 1 Company reputation 2 .36 24 79 Product purchase intentions of the company 2 2. 32 1. 55 21

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74 Table 4 11 Main effect of country reputation Perceived country reputation Attitudes toward the products Purchase intentions toward he product Perceived company reputation facing a crisis Purchase intention of products of the company facing a crisis M SD M SD M SD M SD M SD Country reputation Good 4 94 1.0 1 4.52 1.14 4. 56 1.5 1 3. 8 5 1. 30 2. 97 1. 34 Bad 4. 68 90 4.01 1.02 4. 20 1. 25 3. 56 1.2 2 2. 68 1. 15 p value .01** .00** .01** .03** .03** Table 4 12 Main effect of country of origin salience Perceived country reputation Attitudes toward the products Purchase intentions toward he product Perceived company reputation facing a crisis Purchase intention of products of the company facing a crisis Country of origin salience M SD M SD M SD M SD M SD High 4. 79 .98 4. 19 1.1 8 4.3 2 1.4 4 3.6 8 1.29 2. 90 1.34 Low 4. 84 .95 4. 34 1.0 4 4. 44 1. 36 3. 74 1.2 4 2. 74 1. 17 p value .66 .20 .43 .65 .24

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75 Table 4 1 3 Main effect of type of image restoration strategy Perceived country reputation Attitudes toward the products Purchase intentions toward he product Perceived company reputation facing a crisis Purchase intention of products of the company facing a crisis Types of i mage restoration s trategy M SD M SD M SD M SD M SD Denial(a) 4.8 3 99 4.29 1 20 4.41 1 39 3 29 1. 30 3 10 1 46 No Response (b) 4. 5 0 91 4. 21 1 .10 4. 46 1.35 3.67 1.14 2. 73 1. 12 Corrective Action (c) 5. 12 88 4.29 1 09 4. 27 1 46 4 17 1 22 2 .6 5 1 .12 Post hoc test 1) b < a < c a < b < c a < b, c p value .00** .78 .56 .00** .02** 1) Post hoc test is calculated with significance p < .05 level.

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76 Figure 4 1. Main effect of level of country reputation on perceived country reputation Figure 4

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77 Figure 4 3. Main effect of level of country reputation on purchase intentions toward the Figure 4 4. Main effect of level of country reputation on perceived company reputation facing a crisis

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78 Figure 4 5. Main effect of level of country reputation on purchase intention of products of the company facing a crisis Figure 4 6. Main effect of country of origin salience on perceived country reputation

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79 Figure 4 7. Main effect of country of Figure 4 8. Main effect of country of product s

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80 Figure 4 9. Main effect of country of origin salience on perceived company reputation facing a crisis Figure 4 10. Main effect of country of origin salience on purchase intention of products of the company facing a crisis

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81 Figure 4 11. Main effect of type of image restoration strategy on perceived country reputation Figure 4 12. Main effect of type of image restoration products

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82 Figure 4 13. Main effect of type of image restor ation strategy on purchase intentions toward the Figure 4 14. Main effect of type of image restoration strategy on perceived company reputation facing a crisis

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83 Figure 4 15. Main effect of type of image restoration strategy on purchase intention of products of the company facing a crisis Figure 4 1 6 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration strategy on perceived country reputation

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84 Figure 4 17 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration products Figure 4 18 Three way interaction effect of level of country reput ation, country of origin salience and types of image restoration strategy on purchase intentions toward the

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85 Figure 4 19 Three way interaction effect of level of country reputation, country of origin salience and types of image rest oration strategy on perceived company reputation facing a crisis Figure 4 20 Three way interaction effect of level of country reputation, country of origin salience and types of image restoration strategy on purchase intention of products of the comp any facing a crisis

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86 Figure 4 21 Two way interaction effect of level of country reputation and country of origin salience on perceived country reputation Figure 4 22 Two way interaction effect of level of country reputation and country of origin

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87 Figure 4 23 Two way interaction effect of level of country reputation and country of origin Figure 4 24 Two way interaction effect of level of country reputation and country of origin salience on perceived company reputation facing a crisis

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88 Figure 4 25 Two way interaction effect of level of country reputation and country of origin salience on purchase intention of products of the com pany facing a crisis Figure 4 26 Two way interaction effect of level of country reputation and types of image restoration strategy on perceived country reputation

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89 Figure 4 27 Two way interaction effect of level of country reputation and types of i mage restoration Figure 4 28 Two way interaction effect of level of country reputation and types of image restoration

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90 Figure 4 29 Two way interaction effect of level of country reputation and types of image restoration strategy on perceived company reputation facing a crisis Figure 4 30 Two way interaction effect of level of country reputation and types of image restoration st rategy on purchase intention of products of the company facing a crisis

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91 Figure 4 31 Two way interaction effect of country of origin salience and types of image restoration strategy on perceived country reputation Figure 4 32 Two way interaction effect of country of origin salience and types of image restoration

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92 Figure 4 33 Two way interaction effect of country of origin salience and types of image restoration strategy on Figure 4 34 Two way interaction effect of country of origin salience and types of image restoration strategy on perceived company reputation facing a crisis

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93 Figure 4 35 Two way interaction effect o f country of origin salience and types of image restoration strategy on purchase intention of products of the company facing a crisis

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94 CHAPTER 5 DISCUSSION This study used an experimental design to test potential effects of level of country reputation, country of origin salience and type of image restoration attitudinal and behavioral change during a transnational crisis. The goal o f this research was tri fold. The first goal was to further the body of knowledge of public relations research to better understand and improve the field at large. Secondly, this research attempted to add to the body of knowledge in reputation management t hrough increased understanding of country reputation and country of origin effect. The final goal was to add to the body of knowledge in crisis communication through increased understanding of the effect of image restoration strategies in crisis situations and to identify effective predictive tactics for use by public relations practitioners. The study was designed such that all of these goals could be met. Three hundred and sixty one participants were recruited to take part in one of eight experimental sce narios that incorporated two fictitious newspaper articles followed by a survey ompany, and experiment presented in Chapter 4. The chapter begins with a summary of findings, followed by a detailed analysis of conclusions related to the hypothes es and research questions. Next, a discussion of the implications for public relations theory and practice is provided, followed by a discussion of limitations of this research. Finally, the chapter concludes with recommendations for future research.

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95 Summary of Results This study was designed to identify the impact that various conditions and variables have on the influence of a transnational crisis on host publics. This section summarizes the results described in Chapter 4, including descriptive stati stics and MANOVA findings of: 1) the effect of level of country reputation (good vs. bad), 2) the effect of country of origin salience (high vs. low), 3) the effect of image restoration strategy (corrective action vs. denial vs. not employing one), and 4) the interaction among level of country reputation, country of origin salience and type of image restoration company in volved in the crisis situation. dependent variable of perceived country reputation. Modified from Fombrun Reputation Quotient (Fombrun & Gardberg, 2000), a six item sca le was used to measure differences in item scale, also based on Parameswaran and the dependent variable of att item scale from Kang & Yang (2010) was used. Results indicate that there was no three way interaction effect among level of country reputation, country of origin salience and types of image restoration strategy. There was also no two way interaction effect between level of country reputation and country of origin salience level of country reputation and types of image restoration strategy, and country of origin salience and types of image restoration strategy. However, there was a main effect of level of gene

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96 results indicate there was a main effect of types of image restoration strategy on participan products. Hypotheses Hypothesis 1 stated that a home country with good reputation will be less influenced by its MNC since it will have a higher perceived country reputation (H 1A ), more 1B ), higher purchase intentions toward the 1C ), higher perceived corporate reputation (H 1D ), and higher purchase 1E ) When participants were exposed to news articles about a transnational crisis of a multinational corporation from a country of origin which participants who read news articles about a transnational crisis of a multinational corporation from a country of origin with bad reputat ion. The differences in ratings between the two groups were significant. Therefore, H1 was fully supported. Hypothesis 2 posited that a multinational corporation with low country of origin salience will be less influenced by its transnational crisis since it will have higher perceived country reputation (H 2A 2B ), higher purchase 2C ), higher perceived corporate reputation (H 2D ), and higher purchase intention 2E ) Results showed that participants expressed higher perceived country reputation, more positive attitude towards the perceived cor porate reputation when they were exposed to news articles about a transnational

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97 crisis of a company with low salience of origin. In contrast, participants showed lower purchase hypotheses wer e not supported since the mean difference was not statistically significant. Therefore, Hypothesis 2 was not supported. Hypothesis 3 stated that a country using an image restoration strategy will have a more favorable influence than a country not using an image restoration strategy when its multinational company is having a transnational crisis by having higher perceived country reputation (H 3A ) 3B ), higher purchase intentions toward oducts (H 3C ), higher perceived corporate reputation (H 3D ), and higher purchase 3E ) Hypothesis 3 1 also posited that a country employing corrective action strategy will have more favorable influence than a country using denial strategy since it will have higher perceived country reputation (H 3A 1), more positive 3B 1), higher purchase intentions toward the 3C 1), higher perceived corporate reputation ( H 3D 1), and higher purchase 3E 1) Results indicated for the conditions subjects were exposed to wherein a country of origin used denial strategy or corrective action strategy had higher mean scores on perceived country reputation than when a home country of MNC did not employ an image rest oration strategy in its perceived mean scores given by those who read news articles about a home country of MNC using corrective action strategy and those who rea d about a home country using denial strategy. Thus, H 3A and H 3A products, the corrective action strategy and denial strategy conditions scored higher means than

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98 when the country did n ot employing an image restoration strategy. However, this mean difference was not statistically significant. Furthermore, the mean scores of the corrective action and denial strategy conditions were the same. Therefore H 3B and H 3B 1 are not supported and t he type of image restoration score given by subjects who read news articles about a home country not employing any image restoration strategy and did not responding to the crisis were higher than the mean rating by those who read news articles featuring the corrective action strategy and denial strategy. In addition, participants reading about denial strategy gave a higher mean score than those reading about corrective action strategy. However, none of the mean differences were statistically significant by a post hoc test, so neither H 3C nor H 3C 1 were supported. They were not supported in the reverse case, either. of origin employing corrective action strategy had the highest mean, followed by the condition not using an y image restoration strategy. The denial strategy condition had the lowest mean. Each difference was statistically significant enough to support both H 3D and H 3D 1. Therefore, it is more effective for a country of origin to employ corrective action strateg y for the reputation of its MNC that is facing a transnational crisis. high est mean, followed by the condition not using any image restoration strategy. The corrective action strategy condition had the lowest mean. A post hoc test confirmed that there was

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99 significant difference between each condition, thus H 3E is supported and H 3 E 1 is reversely supported. Therefore, H3 is partially supported. Research Questions Because this study is exploratory and there is not much literature, it featured research questions looking for relations and interactions between each independent variable of level of country reputation, country of origin salience, and types of image restoration strategy. For research question 1, it was found that there was no three way interaction effect among the three independent variables. For research question 2, no tw o way interaction effect was found between level of country reputation and country of origin salience, level of country reputation and types of image restoration strategy, country of origin salience and types of image restoration strategy.

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10 0 Table 5 1. Result of h ypotheses IV DV Result RQ1 Three way interaction N/S RQ2 Two way interaction N/S H 1A Country reputation Perceived country reputation S H 1B Country reputation Attitudes toward the country's products S H 1C Country reputation Purchase intentions toward the country's products S H 1D Country reputation Perceived corporate reputation S H 1E Country reputation Purchase intentions toward the company's products S H 2A Country of origin salience Perceived country reputation N/S H 2B Country of origin salience Attitudes toward the country's products N/S H 2C Country of origin salience Purchase intentions toward the country's products N/S H 2D Country of origin salience Perceived corporate reputation N/S H 2E Country of origin salience Purchase intentions toward the company's products N/S H 3A Types of image restoration strategy Perceived country reputation S H 3A 1 Corrective action strategy Perceived country reputation S H 3B Types of image restoration strategy Attitudes toward the country's products N/S H 3B 1 Corrective action strategy Attitudes toward the country's products N/S H 3C Types of image restoration strategy Purchase intentions toward the country's products N/S H 3C 1 Corrective action strategy Purchase intentions toward the country's products N/S H 3D Types of image restoration strategy Perceived corporate reputation S H 3D 1 Corrective action strategy Perceived corporate reputation S H 3E Types of image restoration strategy Purchase intentions toward the company's products S H 3E 1 Corrective action strategy Purchase intentions toward the company's products N/S

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101 Implications for Theory and Practice Implications for Country Reputation As reputation management is no longer limited only to companies and other organizational and research of public relations (Yang et al, 2008). Out of all the perspectives from which the value of country reputation can be examined, such as public diplomacy and nation branding, this study focused on the economic and industrial influence of country reputation with regard to country of origin effect. It goes with out saying that reputation is important. According to, a good reputation can employee talent, motivate workers, increase job satisfaction, generate more positive media coverage, and garner positive comments from financial analysts (Davies, Chun, da Silva, and Roper, 2003). More importantly, when in crisis situation, a good reputation works like an intangible asset with an ability to help protect the organization. a good reputation serves as an intangible asset which can help protect the organization in times of crisis. Concerning the terms (Jones, Jones, & Little, 2000, crisis situation, and suggested the need for continual reputational maintenance. and alliances to achieve international political objectives (e.g., Nye, 1990, 2004), to influence ain countries of origin (e.g., Bilkey & Nes, 1982; Jeffe & Nebenzahl, 2001; Papadopoulos & Heslop, 1993), and to attract foreign investment (e.g., Kotler & Gertner, 2002) or in bound tourism (e.g.,

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102 Tapachai & Waryszak, 2000). A country with a positive repu tation also has higher chances of receiving aid (Curtin & Gaither, 2007). Country reputation even influences the trade of goods, as countries with bad reputations can be locked into exporting low quality, low cost goods (Cag & Rouzet, 2011). It has been f ound that publics evaluate organizations and their behavior based more on overall evaluations of the country in which the organization was headquartered than on simple out group status, hence there exists the effect of country of origin when multinational organizations were evaluated after a crisis situation (Arpan & Sun, 2006). This effect of country of origin after a crisis situation was observed in two recent transnational crises: the Mattel toy recall crisis in 2007 and the Toyota recall crisis in 2009 2010. Millions of made in China products were recalled in 2007. The Mattel toy recall was an obtrusive case and lead to a negative public opinion about products made in China. According to a poll conducted by Reuters nearly 80 percent of people answered that they were apprehensive about buying goods made in China and nearly two thirds of the respondents reported they were likely to participate in a boycott of Chinese goods until the Chinese government improved regulations governing the safety of goods exp orted to the U.S. (Ryan, 2007). However, and the case was investigated and it has been found that there were misleading facts regarding the increased recalls of Chinese made toys (Beamish and Bapuji, 2008). The majority of recalls resulted from design flaw s. Chinese suppliers were only involved in manufacturing the toys, not in designing them. In addition, although recalls of Chinese made toys increased during this crisis, the rate of increase was slower for recalls of Chinese products compared to the recal ls of products from other countries. So why were the media and the public so outraged about made

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103 in China products? Barney and Zhang (2008) concluded that the outrage may have been influenced by the negative national image of China. The Toyota recall crisi s was an opposite case. Three separate but related recalls of a total of nine million automobiles by Toyota Motor Corporation occurred at the end of 2009 and start of 2010. The pedal entrapment/floor mat problem led several Toyota drivers to unintended acc eleration and ended in fatal crashes, and the recall announcements were heavily covered by related recalls had little to no impact on how consumers perceived the brand. He determined this by lo oking at used car markets to see how much Toyota owners were willing to accept when selling their vehicles and how much used car buyers were willing to pay for them. Hammond (2012) argued that, despite the high profile media coverage of the Toyota recalls, there was very little effect on what consumers were willing to pay for a Toyota and that any effect did not last long. With these established reputation. However, this little effect on Toyo because of the outstanding reputation of Japan and its high quality auto industry. Would the effect of this crisis be similar if Toyota was based in a country with a negative reputation, such as China 2 or Pakistan 3 ? These two opposite cases clearly show the importance of managing country reputation, because it can be an invaluable asset for nations and multinational organizations in crisis situations. The current study tried to analyze the effe ct of country of origin in a crisis situation, and to examine to what extent a different level of country reputation 2 China was ranked as 65th on Country Brand Index 2011. 3 Pakistan was ranked as 113 th on Country Brand Index 2011.

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104 revealed that the level of country reputat the country. This was evident because of the significant difference in perceived country reputation between participants exposed to a crisis of an MNC from a home country with a good reputation, and t hose exposed to a crisis of an MNC from a home country with a bad reputation. In other words, when subjects read news articles a transnational crisis of an MNC with negative home country reputation, they still evaluated the reputation of the country. Meanw hile, those who read stimuli materials covering a crisis of an MNC with positive home country reputation evaluated the reputation of the country positively. This difference is due to their feelings after reading the two news articles that were stimuli in t his experimental design. However, i n reality, if an MNC has a transnational crisis, negative news coverage will be more extensive and the effect on host customers will be greater than measured in this experiment. Moreover, results of this study show empiri cally that the level of reputation which an purchase intentions towards the company in a transnational crisis, but also their attitude and purchase intention toward general products of the country headquarters. Therefore, it is not just also home country. These results visibly demonstrated the significance of maintaining a good reputation on behalf of a country for its industry and economy. I mplications for Country of origin S alience The current study clearly showed that the level of country reputation, or how favorably an publics. However, country of origin salience, (how strongly the MNC is associated with its

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105 dependent variables. There is a tendency an MNC being less associated with its home country with negative reputation had higher means than an MN C strongly associated with its negative home country reputation. However, an MNC enjoying a positive country reputation tended not to show differences whether the MNC is strongly associated to its home country or not (Tse & Gorn, 1993). Yet, the difference among conditions in this study was not statistically significant, thus it cannot be said that the country of origin salience influences the attitude and behavioral intentions of foreign publics. Certain product categories have high levels of salience with their countries of origin: English tea, French perfume, Chinese silk, Japanese automobiles, and so on. These product categories have similarities between general country characteristics and speci fic product features (Etzel & Walkers, 1974). When MNCs selling these kinds of products face a transnational crisis, the product category manipulated in this st udy microwaves is not typically identified with a specific country. Both Japan and China are regarded to some extent as sources of good Asian home electronics, even though there are differences in price range. Thus, it looks like country of origin salie nce Furthermore, when an MNC faces a transnational crisis media coverage includes MNC is associated with its country of

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106 reputation seems to play a bigger role on does the level of countr y of origin salience Implications for Crisis Communication Strategy (Winkleman, 1999). It takes a long time to build a favorable reputation, and crises, or communicative respon se to a crisis can serve to limit and even to repair the reputational damage, scholars of situational crisis communication theory (SCCT) have provided a set of principles to guide the selection of crisis response strategies in order to maximize reputationa l protection (Coombs & Holladay, 2002). The SCCT theory recommends that accommodative strategies that feature apologies for the crisis often are the proper response (e.g., Benoit, 1995; Sellnow, Ulmer, & Snider, 1998). A previous study about the interplay of reputation and the type of response to a crisis (Lyon & Cameron, 2004) also found that an apologetic style of response in a negative news story about a product recall had significant positive effects on attitude. Most SCCT literature covers communicativ e response to a crisis by a corporation in crisis. of origin should employ to benefit its own reputation and that of the MNC. Moreover, the research also investigated whether it wou ld be more effective for a country to employ a communicative tactic in response or not to employ an image restoration strategy. This is important to determine because the MNC facing the crisis more frequently responds to the crisis, rather than the country The results of this study suggest the home country of an MNC in crisis employ an image restoration strategy to limit damage from the crisis and protect the reputation of both the country

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107 and the corporation. However, this strategy does not work to protec communicative tactic is more effective for the other four dependent variables, there was erceived country reputation, corporate reputation, corrective action strategy to protect perceived country reputation and corporate reputation, which measures participan products. Not employing any communicative response was rated second in terms of eff ectiveness for this purpose, and corrective action strategy was the least effective. While conventional wisdom favors the apologetic style of response regardless of responsibility, universal application of highly accommodative strategies is problematic be cause of legal and financial liabilities they incur (Coombs &Holladay, 2002). With a pologies organizations are require d to publicly accept responsibility for a crisis, thereby weakening its legal position in the event of a lawsuit (Fitzpatrick, 1995; Tyler 1997). Likewise, participants who were exposed to corrective action strategy in this experiment seemed to regard the country crisis was manipulated in the stimu li materials as not yet having been thoroughly investigated. Thus, while subjects exposed to corrective action strategy condition tended to show favorable attitudes toward the country reputation and corporate reputation, they seem to have lost confidence i products since the country is not denying responsibility.

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108 That being said, each communicative response has advantages and disadvantages. To protect the reputation of the co untry and the MNC, corrective action strategy is more effective. On the other hand, when a home country employs a denial strategy, it can help foreign public to appropria te is like determining which came first the chicken or the egg? The decision should be based on the situations which with the country and the company are dealing. However, this study recommends employing an apologetic response style to protect reputation demonstrated that an MNC with favorable home country reputation had more positive influence also showed the importance of having a good home country reputation and MCN reputation, as the damage to Toyota was minor and did not last long (Hammond, 2012). Implications for Practice This research highlights important implications for public relation s practitioners, especially those who work with multinational clients. The first implication is that practitioners should downplay the notion of an unfavorable country reputation for an MNC in a crisis situation, because the unfavorable country reputation has negative country of origin effects on attitudes headquarters are in a country with a negative reputation, headquarters practitioners should try to emphasize enga ge the MNC with other, possibly favorable countries of origin. Even though so called country of origin usually refers to a home country where the headquarters of an MNC is of origin is not limited to headquarters residence in this global age. There are several other concepts such as designed in country image (DCI), country of assembly (COA), and country of productions (COP). When an MNC has a negative

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109 home country reputation with its headquarters location, practit ioners may try to offset this unfavorable influence by emphasizing other possibly good countries of origin. For example, if a Chinese MNC faces a transnational crisis, practitioners working on that crisis should avoid mentioning China in press releases. In stead, they should highlight some other fact, such as the with a favorable country reputation. Moreover, in an effort to lower the salience of its negative country of origin, an MNC with a negative home country reputation should focus only on its brand name and should not associate it with country of origin while promoting its products and the MNC when not in a crisis situation. On the contrary, an MNC with a positi ve home country reputation should make the most of opportunities to utilize it as an asset, both in crisis and non crisis situations. Figure 5

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110 practical management of public relations crises. The massive product recall issue in this experiment falls in the category of unintentional crises that are unforeseea ble or unavoidable. When an unintentional crisis hits an unprepared organization, the result of the crisis will be bigger, and the organization will face a more difficult recovery. Thus, although unintentional crises are mostly unpredictable, organizations should be proactive by taking steps to reduce their impact in crisis situations. Preparing scenarios of expected crises should be based on an analysis the MNC employ a communicative tactic to respond to the crisis. As the results of this study of origin employs an image restoration strategy. When choosing which kinds of image r estoration strategy the home country should use, there should be a clear reason either for deploying corrective action strategy to protect the reputation of the country or the MNC (long term), or using denial strategy to minimize the damage to sales volume (short term). Implications for Public Relations Theory The study reported here has several implications for development of theory in public relations Whereas crisis communication literature can be found in business and management, it is a public relation s construct and its key theorist, Timothy Coombs, is a public relations scholar and teacher. This study advanced theory in crisis communication management by building upon Situational Crisis Communication Theory and demonstrating the critical role of image restoration There are few studies developing and testing the use of communicative responses to crises by a home country, not the studies analyzing the effect of image restoration strategy used by a country. However, both used the qualitative

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111 method to describe the situation and the narratives. This study is noteworthy for obtaining empirical evidence regarding the independent effec ts of image restoration strategy employed by 2 x 2 x 3 factorial experiment. S econd, this study found that the country of origin effect exists in a crisis situation, because participants used the level of country reputation as an informational cue to judge the reputation of the country and the company, and even the quality of the co empirical evidence for the importance of managing country reputation. Country of origin effect mostly has been covered in business literature, with a s ales and production focus. However, this study found the effect exists in crisis situations, and suggests that it needs to be further studied in the field of international public relations. reputation add to the body of knowledge on country reputation within the field of reputation management in public relations theory. As with any organization, it is i mportant to manage a side. This study emphasizes the need for further research in country of origin effect as related to country reputation. In addition, it was found that the country of origin salience does not have perceived country reputation played a bigger role than how closely the MNC is associated with its home cou ntry.

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112 Further, this exploratory study found that there was no three way interaction effect among the level of country reputation, country of origin salience, and the types of image restoration strategy. There was also no two way interaction effect between level of country reputation, country of origin salience, and type of image restoration strategy. Lyon and Cameron (2004) found that there was no interaction effect between reputation and response type; however, their study focused on the reputation of corp to their findings, with no interaction effect between country reputation and response type. Limitations It is the nature of research that there be limitations to a study. This study is not an except ion and has several limitations relating to its method, sample, and manipulations. Unlike the survey method, which takes place in the real world, the experimental method is based upon the creation of artificiality to produce extremes in effect. Stimuli mat erials were carefully manipulated to look like real newspaper articles in order to lessen the artificiality and increase its generalizability. Despite these efforts, it is possible that some participants identified the fictitious nature of the newspaper ar ticles, which may have affected their results. Another limitation of this study is the artificial environment of the experiment. The lab atmosphere offered a quiet setting to participants and enough exposure time to the news articles; however, it could hav e affected news articles. Secondly, there was a limitation on the characteristics of subjects. The subjects were all undergraduate students attending a large sou theastern public university in the United States, a representative homogeneous group. The participants were skewed in terms of gender as well, since many more female students participated in the experiment than male students. This group definitely does not represent the population beyond themselves. Therefore, even though the

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113 results may be applied to a specific real world situation, they cannot be generalized to the real world. As such, the results of the study could be quite different with an older popula tion and should not be generalized to all populations. In addition, students from the Southern region of the United States may be different from students in other geographic locations. Thus, future research should use a wider demographic base to generalize the results across segments. Yet another limitation of this study relates to the manipulation. Japan and China were chosen for manipulating the independent variable of level of country reputation, based on the CountryRep SM 2010 Report by Reputation Instit ute This report ranked Japan as having a good country reputation and China as having a bad country reputation. These two countries were chosen from the continent of Asia, because choosing countries from different continents would be problematic. Doing so is not ideal because participants may have different stereotypes and expectations for each continent, culture and multinational corporations whose headquarters belong to that continent. In order to generalize the findings, this study needs to be replicated using countries from continents other than Asia. In addition, the length of stimuli materials are slightly shorter for the conditions of not employing image restoration strategy around 100 words compared to the conditions of employing either corrective action or denial strategy. Even though the manipulation check of the type of image restoration strategy, this difference in the length of the message may have study. Another limitation is associated with the product category in the stimuli materials. Microwaves belong to a medium or medium high level involvement product category, and results could vary with the use of a low involvement product category or of a high inv olvement product category, such as automobiles. Future studies should employ different kinds of industries

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114 in various categories to examine whether the findings of this study can be generalized to other categories. Finally, the method of measuring dependen t variables in the study could be improved. Because all the dependent variables in this study were measured right after the news story was shown to the participants, important long term effects were not analyzed. Lyon and Cameron (2004) studied the long te rm effects of negative publicity and the influence of time delay. finished reading the news article. Evaluating the long term effects of negative publicity will improve understanding of how long a transnational crisis may influence potential customers. Suggestions for Future Research Based on the limitations described above, the researcher has several recommendations for future research. First, the researcher rec ommends reiterating this experiment with host publics of countries other than United States. Use of image restoration strategies may be regarded differently in other countries based on their cultures, and host publics in other countries may react and chang e their attitudes and behavioral intentions in different ways. Testing the type of image restoration strategy with samples of other cultures may add to the body of knowledge in the field of crisis communication. Furthermore, this study only manipulated the level of country reputation as one of the independent variables. However, designing an experiment with both the level of country reputation (good vs. bad) and the level of company reputation (good vs. bad) would help to determine which is more influential intentions during crises between a good country reputation or a good company reputation. Moreover, this study manipulated the crisis situation as one wherein the cause of the crisis had not been thoro ughly investigated yet. The company may or may not be blamed for the crisis

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115 later, but were not held responsible for the crisis in the stimuli news articles. The findings of this study offer empirical evidence for use in a crisis situation like this, espec ially during the step of identifying the cause of a crisis and the responsible party. However, the result might be different when an organization is faced with unavoidable evidence of responsibility, or when the organization is completely innocent, not hav ing any responsibility for a crisis. Choosing an appropriate image restoration strategy should be based on this factor. Therefore, the researcher suggests replicating this experiment with responsibility as an independent variable; a 2 (country reputation: good vs. bad) x 2 (responsibility: organization as being responsible vs. not responsible). exposed to the stimuli materials including the type of image restoration st rategy. The correlation between how much participants believe the message is real and persuasive and how much they change their attitudes and behavioral intentions will strengthen the experiment design of this study.

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116 APPENDIX A INFORMED CONSENT PRO TOCOL Protocol Title: A Quantitative Experiment of the Effects of Transnational Crises on Corporate and Country Reputation and Strategic Responses Please read this consent document carefully before you decide to pa rticipate in this study. Purpose of the research study This study aims to analyze the potential effects of transnational corporate crises in host on the attit ude and behavioral intentions of foreign publics. What you will be asked to do in the study: Following a brief instruction you will be asked to read a news article about a transnational crisis of a multinational company. After browsing the contents of the news article, you will be asked to proceed and answer the questions in the self administered questionnaire. When you are done with the questi onnaire, you will be asked to provide your demographic information. This study is completely confidential and the information you provide will be only used for statistical purpose. Time required: 15 minutes Risks and Benefits: We do not anticipate that you will benefit directly by participating in this experiment. There is no anticipated risk. Compensation: There is no financial compensation. However, y ou will be offered extra credits by participating in this study. The exact amounts of extra credits are decided by course instructors The exact amount of extra credits will not exceed 1 % of the total points in the course If you do not wish to participate in this research, you may ask the course instructor for another extra credit opportunity which will be equivalent amount of time/effort with this research. Confidentiality: Your identity will be kept confidential to the extent provided by law. Your information will be assigned a code number. The list connecting your name to this number will be kept in a lo cked file in my faculty supervisor's office. When the study is completed and the data have been analyzed, the list will be destroyed. Your name will not be used in any report.

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117 Voluntary participation: Your participation in this study is completely voluntar y. There is no penalty for not participating. Right to withdraw from the study: You have the right to withdraw from the study at any time without consequence. Whom to contact if you have questions about the study: Hyun Ji Lim Doctoral Student Department of Public Relations, College of Journalism and Communications, 2133 Weimer Hall, P.O. Box 118400, phone 352 392 6728 Dr. Juan Carlos Molleda Associate Professor & Graduate Coordinator, Department of Public Relations, College of Journalism and Communicati ons, 3046 Weimer Hall, P.O. Box 118400, 352 273 1223 Whom to contact about your rights as a research participant in the study: IRB02 Office, P.O. Box 112250, University of Florida, Gainesville, FL 32611 2250; phone 352 392 0433. Agreement: I have read the procedure described above. I voluntarily agree to participate in the procedure and I have received a copy of this description. Participant: ______________________________________ Date: _________________ Principal Investigator: ___________________________ ___ Date: _________________ Approved by University of Florida Institutional Review Board 02 Protocol # 2010 U 1 219 For Use Through 0 9 21 2012

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118 APPENDIX B EXPERIMENTAL MANIPUL ATIONS 1: Bad country reputation x Low country of origin salience x Corrective action GIW is a Chinese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its products include air conditioners, mobile phones, computers, microwave ovens, washing mac hines, refrigerators, and televisions. Since its founding in 1918, production facility in the United States at Camden, South Carolina, opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer and President of GIW Corporation of America. Mitsukoshi was ranked the 89th largest company in the world in 2009 by the Forbes Global 2000.

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119 1: Bad country reputation x Low country of origin salience x Corrective actio n September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Shifen Zhang contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics commission and company have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper b ody when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other sta tes, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serio us injuries to customers. to find the problem with the microwaves and correct it. We encourage anyone who owns a GIW QuickCook microwave to call the hotline Today the Chinese Minister of Commerce, Jiang Zenwei, held a press conference assuring the pub lic of the safety of Chinese made products, including the GIW microwaves. fully to determine the cause of the problems, I want to assure consumers of Chinese products facilities to make sure proper quality control methods are in place. We want to make sure all

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120 GIW began selling QuickCook microwaves in April 2009. The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the recall, Quic kCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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121 1: Bad country reputation x Low country of origin salience x Corrective action September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Wei Tang contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW the major Chinese electronics company announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. GIW has been facing media scrutiny since mid S eptember after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuri es to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. James Gre our QuickCook microwaves and are deeply grieved to hear injuries of our customers have to ensure future safety, we stand by our products and are investigating the quality of electrical Activist organizations have been formed on Facebook and Twitter questioning the quality of Chinese products and holding the country responsible for the explosions. The Chinese government held a press conference yesterday, defending the quality of their pr oducts. The conference was broadcasted globally.

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122 Jiang Zenwei, Chinese Minister of Commerce, said that GIW along with other major electronics manufacturing companies will be subject to government inspection, e to announce that the Chinese government will be The Chinese government has contributed $10 million to the developing investigation of what caused the explosions. It has accepted responsibility for the explosions and will initiate legislation for more critical product regulations. will enact strict regulations ensuring higher quality products to prevent any further injury from This is the largest microwave recall to date. The GIW QuickCook microwaves hav e been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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123 2: Bad country reputation x Low country of origin salience x Denial GIW is a Chinese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its products include air conditioners, mobile phones, computers, microwave ovens, washing machines, refrigerators, and televisions. Since i goods in 2010. GIW built a production facility in the United States at Camden, South Carolina, opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer and Pres ident of GIW Corporation of America. Mitsukoshi was ranked the 89th largest company in the world in 2009 by the Forbes Global 2000.

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124 2: Bad country reputation x Low country of origin salience x Denial September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Wei Tang contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics commission and company have received more than a dozen complaints from customers whose microwaves expl oded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to o pen the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause seriou s injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. ith our QuickCook microwaves and are deeply grieved to correct it. We e ncourage anyone who owns a GIW QuickCook microwave to call the hotline Today the Chinese Minister of Commerce, Jiang Zenwei, held a press conference assuring the public of the safety of Chinese made products, including the GIW microwaves. alleged incidents with the microwaves are overstated to electronics so that electronics products made by North American companies can steal our He continued by reassuring consumers about the reliability and safety of Chinese electronics.

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125 nt in the quality of any products made in China. We want consumers of When asked why the microwaves exploded, Zenwei said the events had likely been exaggerated or tha t customers had used the microwaves in an unsafe manner. GIW began selling QuickCook microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook microwave owners sh ould call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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126 2: Bad country reputation x Low country of origin salience x Denial September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Xu Shifen contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW, the major Chinese electronics company, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. GIW has been facing media scrutiny since mid September after 16 separate inc idents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of t he more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. our QuickCook microwaves and are deeply grieved to hear injuries of our customers have issuing a recall to ensure future safety, we stand by our products and are investigating the quality Chinese government denies respo nsibility of the recall after increased media attention and the reports of the most recent injuries in Philadelphia this week. Activist organizations have been formed on Facebook and Twitter questioning the quality of Chinese products and holding the coun try responsible for the explosions. The Chinese government held a press conference yesterday, defending the quality of their products. The conference was broadcasted globally.

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127 Jiang Zenwei, Chinese Minister of Commerce, said that due to strict product regulation codes, the microwave explosions were not due to faulty Chinese manufacturing. in their respective countries processes and any This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743 Copyright 2011 The Wall Street Journal Company

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128 3: Bad country reputation x Low country of origin salience x No response GIW is a Chinese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its pr oducts include air conditioners, mobile phones, computers, microwave ovens, washing machines, refrigerators, and televisions. goods in 2010. GIW built a production facility in the United States at Camden, South Carolina, opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer an d President of GIW Corporation of America. Mitsukoshi was ranked the 89th largest company in the world in 2009 by the Forbes Global 2000.

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129 3: Bad country reputation x Low country of origin salience x No response September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Wei Tang contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics commission and company have received more than a dozen complaints from customers who se microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that di d not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. ere is a problem with our QuickCook microwaves and are deeply grieved to d correct it. We encourage anyone who owns a GIW QuickCook microwave to call the hotline While there are increasing numbers of people questioning the safety of products made in China, the Chinese government has not yet release d an official statement nor scheduled a press conference regarding the current situation. GIW began selling QuickCook microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the reca ll, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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130 3: Bad country reputation x Low country of origin salience x No response September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Xu Shifen contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW, the major Chinese electronics company, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. GIW has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. r, our QuickCook microwaves and are deeply grieved to hear injuries of our customers have issuing a recall to ensure future safety, we stand by our products and are investigating the quality of electrical wiring of the buildings in which the incidents o Activist organizations have been formed on Facebook and Twitter questioning the quality of Chinese products and holding the country responsible for the explosions. However, while public opinion toward China and the quality of its products is ge tting worse, the Chinese government has not responded to the current product recall situation so far. This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, c all (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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131 4 : Bad country reputation x High country of origin salience x Corrective action Hong Xing is a Chinese multinational consumer electronics corporation headquartered in products include microwave ovens, air conditioners, mobile phones, computers washing machines, refrigerators, and televisions. Since its founding in 1918, it has grown to become one of the largest Chinese electronics worldwide for the past five years. Hong Xing has its production facilities wi North America is in charge of sales and management, and Zhang Ruimin is a Chairman and CEO.

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132 4: Bad country reputation x High country of origin salience x Corrective action September 23, 2011, Friday, Fina l Edition Reports of explosions, injuries lead to HongXing microwave recall BYLINE: By Laura Mize; Ming Zheng contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., Sept ember 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics commission and company have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar com plaints, with at least three citing serious injuries to customers. special and correct it. We encourage anyone who owns a HongXing QuickCook microwave to call the Today the Chinese Minister of Commerce, Ji ang Zenwei, held a press conference assuring the public of the safety of Chinese made products, including the HongXing microwaves. matter fully to determine the cause of the problems, I want to assure consumers of Chinese manufacturing facilitie s to make sure proper quality control methods are in place. We want to make sure all products made in

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133 HongXing began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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134 4: Bad country repu tation x High country of origin salience x Corrective action September 23, 2011, Friday, Final Edition HongXing recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Xu Shifen contributed reporting for this article. SECTION: Sect ion C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from HongXing, the major Chinese electronics company, obal recall for an estimated over 2 million model QuickCook microwaves on Thursday. HongXing has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. The cause of the explosions has not been determin our QuickCook Microwaves and are deeply grieved to hear injuries of our customers have are issuing a recall to ensur e future safety, we stand by our products and are investigating the Activist organizations have been formed on Facebook and Twitter questioning the quality of Chinese products and holding the country responsible for the explosions. The Chinese government held a press conference yesterday, defending the quality of their products. The conference was broadcasted globally. Jiang Zenwei, Chinese Minister of Commerce, said that Hon gXing along with other major electronics manufacturing companies will be subject to government inspection,

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135 issuing a nationwide inspection of electronics manu The Chinese government has contributed $10 million to the developing investigation of what caused the explosions. It has accepted responsibility for the explosions and will initiate legislation for more critical product regulations. will enact strict regulations ensuring higher qua lity products to prevent any further injury from This is the largest microwave recall to date. The HongXing QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copy right 2011 The Wall Street Journal Company

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136 5 : Bad country reputation x High country of origin salience x Denial Hong Xing is a Chinese multinational consumer electronics corporation headquartered in business is in electronics manufacturing; its products include microwave ovens, air conditioners, mobile phones, computers, washing machines, refrigerators, and televisions. Since its founding in 1918, it has grown to become one of the largest Chinese ele ctronics wor ldwide for the past five years. Hong Xing North America is in charge of sale s and management, and Zhang Ruimin is a Chairman and CEO.

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137 5: Bad country reputation x High country of origin salience x Denial September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to HongXing microwave recall BYLINE: By Laur a Mize; Miao Guo contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics company have received more than a dozen complaints from customers whos e microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. re is a problem with our QuickCook microwaves and are deeply grieved to es and correct it. We encourage anyone who owns a HongXing QuickCook microwave to call the hotline established for the Today the Chinese Minister of Commerce, Jiang Zengwei, held a press conference assuring the public of the safety of Chinese mad e products, including the HongXing microwaves. reports, alleged incidents with electronics so that electronics products made by North American companies can steal our

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138 He continued by reassuring consumers about the reliability and safety of Chinese electronics. Chinese When asked why the microwaves exploded, Zengwei said the event s had likely been exaggerated or that customers had used the microwaves in an unsafe manner. HongXing began selling QuickCook Microwaves in July 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2million. For details about th e recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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139 5: Bad country reputation x High country of origin salience x Denial September 23, 2011, Friday, Final Edition HongXing recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Miao Qing contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DAT ELINE: Washington, D.C., September 23 Washington D.C. Representatives from HongXing, the major Chinese electronics company, estimated over 2 million model QuickCook microwaves on Thursday. HongXing has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 millio n. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. our QuickCook Microwav es and are deeply grieved to hear injuries of our customers have are issuing a recall to ensure future safety, we stand by our products and are investigating the Chinese government denies responsibility of the recall after increased media attention and the reports of the most recent injuries in Philadelphia this week. Activist organiz ations have been formed on Facebook and Twitter questioning the quality of Chinese products and holding the country responsible for the explosions. The Chinese government held a press conference yesterday, defending the quality of their products. The conf erence was broadcasted globally.

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140 Jiang Zenwei, Chinese Minister of Commerce, said that due to strict product regulation codes, the microwave explosions were not due to faulty Chinese manufacturing. monitored protocols f This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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141 6: Bad country reputation x High country of origin salience x No response Hong Xing is a Chinese multinational consumer electronics corporation headquartered in products include microwave ovens, air conditioners, mobile phones, computers washing machines, refrigerators, and televisions. Since its founding in 1918, it has grown to become one of the largest Chinese electronics wor ldwide for the past fiv e years. Hong Xing North America is in charge of sales and management, and Zhang Ruimin is a Chairman and CEO.

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142 6: Bad country reputation x High country of origin salience x No response September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to HongXing microwave recall BYLINE: By Laura Mize; Miao Guo contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGT H: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Chinese electronics announced a recall of the company have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday af ter a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. and correct it. We encourage anyone who owns a HongXing QuickCook microwave to call the hotline established for the recall. While there are increasing numbers of people questioning the safety of products made in China, the Chinese government has not yet released an official statement nor scheduled a press conference regarding the current situation. HongXing began selling QuickCook Microwaves in July 2009. The recall includes all QuickCook microwaves sold since then, an estimated 2million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the micr owave ready when calling. Copyright 2011The New York Times Company

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143 6: Bad country reputation x High country of origin salience x No response September 23, 2011, Friday, Final Edition HongXing recalls microwave after explosions span the globe BYLINE: B y Lydia Williams; Miao Qing contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from HongXing, the major Chinese electroni cs company, estimated over 2 million model QuickCook microwaves on Thursday. HongXing has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more s evere reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. our QuickCook Microwaves and are deeply grieved to hear injuries ofour customers have are issuing a recall to ensure future safety, we stand by our products and are investigating the Activist organizations have been fo rmed on Facebook and Twitter questioning the quality of Chinese products and holding the country responsible for the explosions. However, while public opinion toward China and the quality of its products is getting worse, the Chinese government has not responded to the current product recall situation so far. This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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144 7: Good country reputation x Low country of origin salience x Corrective action GIW is a Japanese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its products include air co nditioners, mobile phones, computers, microwave ovens, washing machines, refrigerators, and televisions. goods in 2010. GIW was ranked the 89th largest company in the w orld in 2009 by the Forbes Global 2000. GIW built a production facility in the United States at Camden, South Carolina, which opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer and President of GIW Corporation of America.

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145 7: Good country reputation x Low country of origin salience x Corrective action September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Tomomi Natsuko contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Japanese electronics uickCook Microwaves, saying the commission and company have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philad elphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Thr ee other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an u nspecified number of similar complaints, with at least three citing serious injuries to customers. correct it. We encourage anyone who owns a GIW QuickCook microwave to call the hotline Today the Japanese Mi nister of Economy, Trade and Industry, Yukio Edano, held a press conference assuring the public of the safety of Japanese made products, including the GIW microwaves. se fully to determine the cause of the problems, I want to assure consumers of Japanese products worldwide that the Ministry also will investigate practices at the c facilities to make sure proper quality control methods are in place. We want to make sure all

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146 GIW began selling QuickCook Microwaves in April 2009.The recall includes all Quic kCook Microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook Microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Co mpany

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147 7: Good country reputation x Low country of origin salience x Corrective action September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Minami Sagawa contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW, the major Japanese electronics company, announced a global recall for an estimated ov er 2 million model QuickCook microwaves on Thursday. GIW has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. h our QuickCook microwaves and are deeply grieved to hear injuries of our customers have issuing a recall to ensure future safety, we stand by our products and are investigating the quality Activist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the expl osions. The Japanese government held a press conference yesterday, defending the quality of their products. The conference was broadcasted globally. Yukio Edano, Japanese Minister of Commerce, said that GIW along with other major electronics manufacturing companies will be subject to government inspection,

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148 take The Japanese government has contributed $10 million to the developing investigation of what caused the explosions. It has accepted responsibility for the explos ions and will initiate legislation for more critical product regulations. will enact strict regulations ensuring higher quality products to prevent any further inj ury from This is the largest microwave recall to date. The GIW QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011The Wall Street Journal Company

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149 8: Good country reputation x Low country of origin salience x Denial GIW is a Japanese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its products include air conditioners, mobile phones, comput ers, microwave ovens, washing machines, ref rigerators, and televisions. goods in 2010. GIW was ranked the 89th largest company in the world in 2009 by the Forbes Global 2000. GIW built a production facility in the United States at Camden, South Carolina, which opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer and President of GIW Corporation of America.

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150 8: Good country reputation x Low country of o rigin salience x Denial September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Tomomi Sagawa contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Japanese electronics commission and co mpany have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on he r arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have be en reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. for the Western hem correct it. We encourage anyone who owns a GIW QuickCook microwave to call the hotline Today the Japanese Minister of Economy, Trade and Industry, Yukio Edan o, held a press conference assuring the public of the safety of Japanese made products, including the GIW microwaves. electronics so that electronics products made by North American companies can steal our

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151 He conti nued by reassuring consumers about the reliability and safety of Japanese electronics. Japanese products worldwide to know that our manufacturing processes are When asked why the microwaves exploded, Edano said the events had likely been exaggerated or that customers had used the microwaves in an unsafe manner. GIW began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Time s Company

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152 8: Good country reputation x Low country of origin salience x Denial September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Minami Sakio contributed reporting for this arti cle. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW, the major Japanese electronics company, announced a global recall for an estimated over 2 milli on model QuickCook microwaves on Thursday. GIW has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more t han $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. our QuickCook Microwaves and are deeply grieved to hear injuries of our customers have issuing a recall to ensure future safety, we stand by our products and are invest igating the quality Japanese government denies responsibility of the recall after increased media attention and the reports of the most recent injuries in Philadelphia this week. Act ivist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the explosions. The Japanese government held a press conference yesterday, defending the quality of their pro ducts. The conference was broadcasted globally.

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153 Yukio Edano, Japanese Minister of Economy, Trade and Industry, said that due to strict product regulation codes, the microwave explosions were not due to faulty Japanese manufacturing. he and very precise and well Edano malfunction This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011The Wall Street Journal Company

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154 9: Good country reputation x Low country of origin salience x No response GIW is a Japanese multinational consumer electronics corporation. Its main business is in electronics manufacturing. Its products include air conditioners, mobile phones, computers, microwave ovens, washing machines refrigerators, and televisions. goods in 2010. GIW was ranked the 89th largest company in the world in 2009 by the Forbes Global 2000. GIW built a production facility in the United States at Camden, South Carolina, which opened in 2000. Howard Stringer is a Chairman, Chief Executive Officer and President of GIW Corporation of America.

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155 9: Good country reputation x Low country of origin salience x No response September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to GIW microwave recall BYLINE: By Laura Mize; Tomomi Sagawa contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Japanese electronics commission and company have received more than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper b ody when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other sta tes, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serio us injuries to customers. to find the problem with the microwaves and correct it. We encourage anyone who owns a GIW QuickCook microwave to call the hotline While there are increasing numbers of people questioning the safety of products made in Japan, the Japanese government has not yet released an official statement nor scheduled a press conference regarding the current situation. GIW began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an est imated 2 million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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156 9: Good country reputation x Low country of origin salience x No response September 23, 2011, Friday, Final Edition GIW recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Minami Sakio contributed reporting for this article. SECTION: Section C; Column 6; Busin ess/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from GIW, the major Japanese electronics company, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursda y. GIW has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. our QuickCook microwaves and are deeply grieve d to hear injuries of our customers have issuing a recall to ensure future safety, we stand by our products and are investigating the quality of electrical wiring o Activist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the explosions. However, while public opinion toward Ja pan and the quality of its products is getting worse, the Japanese government has not responded to the current product recall situation so far. This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011The New York Times Company

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157 10 : Good country reputation x High country of origin salience x Corrective action Mitsukoshi is a Japanese multinational consumer electronics c orporation headquartered in Minato, Tokyo, Japan. Its main business is in electronics manufacturing; its products include microwave ovens, air conditioners, mobile phones, computers, washing machines, refrigerators, and televisions. Since its founding in 1 918, it has grown to become one of the largest Japanese electronics worldwide for the past five years. To ensure its product quality, Mitsukoshi continues production of its products lines management, and Akihiro Ohata is the Chairman, Chief Executive Officer and President of Mitsukoshi Corporation of America.

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158 10: Good country reputation x High country of origin salience x Corrective action September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to Mitsukoshi microwave recall BYLINE: By Laura Mize; Tomomi Sagawa contributed reporting for this a rticle. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Safety Commission and Japanese electronics giant Mitsukoshi, whose headquarter is based i n Tokyo, Japan, today announced a recall of the than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hos pital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Aff airs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. hea microwaves and correct it. We encourage anyone who owns a Mitsukoshi QuickCoo k Today the Japanese Minister of Economy, Trade and Industry, Yukio Edano, held a press conference assuring the public of the safety of Japanese made products, including the Mitsukoshi microwaves. matter fully to determine the cause of the problems, I want to assure c onsumers of Japanese manufacturing facilities to make sure proper quality control methods are in place. We want to make sure all products made in Japan are safe for their

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159 Mitsukoshi began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook Microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook Microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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160 10: Good country reputation x High country of origin salience x Corrective action September 23, 2011, Friday, Final Edition Mitsukoshi recalls microwave after explosions span the globe BYLINE: By Lydia Williams; Minami Sakio contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 397 words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from Mitsukoshi, the major Japanese electronics company, headquartered in Tokyo, Japan, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. Mitsukoshi has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. Jam our QuickCook Microwaves and are deeply grieved to hear injuries of our customers have susta investigating the quality of electrical wiring of the buildings in which the incid Activist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the explosions. The Japanese government held a press conference yesterday, defending the quality of their products. The conference was broadcasted globally. Yukio Edano, Japanese Minister of Economy, Trade and Industry, said that Mitsukoshi along with other major electronics manufacturing companies will be subject to government inspection,

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161 In light of the current situation we would like to announce that the Japanese government will be all inconsistencies into account when researching the problem a The Japanese government has contributed $10 million to the developing investigation of what caused the explosions. It has accepted responsibility for the explosions and will initiate legislation for more critical product regulat ions. will enact strict regulations ensuring higher quality products to prevent any further injury from This is the largest microwave recall to date. The Mitsukoshi QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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162 1 1 : Good country reputation x High country of origin salience x Denial Mitsukoshi is a Japanese multinational consumer electronics corporation headquartered in Minato, Tokyo, Japan. Its main business is in electronics manufacturing; its products include microwave ovens, air conditioners, mo bile phones, computers, washing machines, refrigerators, and televisions. Since its founding in 1918, it has grown to become one of the largest Japanese electronics worldwide for the past five years. To ensure its product quality, Mitsukoshi continues production of its products lines management, and Akihiro Ohata is the C hairman, Chief Executive Officer and President of Mitsukoshi Corporation of America.

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163 11: Good country reputation x High country of origin salience x Denial September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to Mitsukoshi microwave recall BYLINE: By Laura Mize; Tomomi Inato contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washington, D.C. The U.S. Consumer Product Saf ety Commission and Japanese electronics giant Mitsukoshi, whose headquarter is based in Tokyo, Japan, today announced a recall of the than a dozen complaints from customer s whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just a s she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other states, as well as numerous explosions th at did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing serious injuries to customers. recognize there is a problem with our QuickCook Microwaves and are deeply grieved to m with the microwaves and correct it. We encourage anyone who owns a Mitsukoshi QuickCook Today the Japanese Minister of Economy, Trade and Industry, Yukio Edano, held a press conference assuring the public of the safety of Japanese made products, including the Mitsukoshi microwaves. can reports about the electronics so that electronics products made by North American companies can steal our

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164 He continued by reassuring consumers a bout the reliability and safety of Japanese electronics. When asked why the microwaves exploded, Edano said the events had likely been exaggerated or that customers had used the microwaves in an unsafe manner. Mitsukoshi began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook microwaves sold since then, an estimated 2 million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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165 11: Good country reputati on x High country of origin salience x Denial September 23, 2011, Friday, Final Edition Mitsukoshi recalls microwave after explosions span the globe BYLINE: By Lydia Willams; Natsuko Ogawa contributed reporting for this article. SECTION: Section B; Column 6; Business/Financial Desk; LENGTH: 397words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from Mitsukoshi, the major Japanese electronics company, headquartered in Tokyo, Japan, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. Mitsukoshi has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cost of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cle veland. roblem with our QuickCook Microwaves and are deeply grieved to hear injuries ofour customers have our products and are Japanese government denies responsibility of the recall after increased media attention and the reports of the most recent injuries in P hiladelphia this week. Activist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the explosions. The Japanese government held a press conference yesterday, defendi ng the quality of their products. The conference was broadcasted globally.

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166 Yukio Edano, Japanese Minister of Economy, Trade and Industry, said that due to strict product regulation codes, the microwave explosions were not due to faulty Japanese manufactur ing. and deny the allegations of a national manufacturing Edano malfunction This is the largest microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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167 12: Good country reputation x High country of origin salience x No response Mitsukoshi is a Japanese multinational consumer electronics corporation headquartered in Minato, Tokyo, Japan. Its main business is in electronics manufacturing; its products include micro wave ovens, air conditioners, mobile phones, computers, washing machines, refrigerators, and televisions. Since its founding in 1918, it has grown to become one of the largest Japanese electronics producers. Mitsukoshi has been featured as one of Forbes ma wor ldwide for the past five years. To ensure its product quality, Mitsukoshi continues production of its products lines manage ment, and Akihiro Ohata is the Chairman, Chief Executive Officer and President of Mitsukoshi Corporation of America.

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168 12: Good country reputation x High country of origin salience x No response September 23, 2011, Friday, Final Edition Reports of explosions, injuries lead to Mitsukoshi microwave recall BYLINE: By Laura Mize; Tomomi Inato contributed reporting for this article. SECTION: Section C; Column 6; Business/Financial Desk; LENGTH: 422words DATELINE: Washington, D.C., September 23 Washingt on, D.C. The U.S. Consumer Product Safety Commission and Japanese electronics giant Mitsukoshi, whose headquarter is based in Tokyo, Japan, today announced a recall of the re than a dozen complaints from customers whose microwaves exploded while cooking. Jana Fischer, a spokesperson for the commission, said the latest complaint came Monday after a Philadelphia woman reportedly suffered large cuts on her arms, face and upper body when her microwave exploded just as she was reaching to open the door. The woman was treated at a Philadelphia hospital and had many pieces of shrapnel removed from her skin. Three other cases involving serious injuries have been reported in other s tates, as well as numerous explosions that did not cause serious injuries. A spokesperson with the Office of Consumer Affairs in Canada confirmed today that the office has received an unspecified number of similar complaints, with at least three citing ser ious injuries to customers. affairs specialist for the Western hemisphere. microwaves and correct it. We encourage anyone who owns a Mitsukoshi QuickCook While there are increasing numbers of people questioning the safety of p roducts made in Japan, the Japanese government has not yet released an official statement nor scheduled a press conference regarding the current situation. Mitsukoshi began selling QuickCook Microwaves in April 2009.The recall includes all QuickCook micro waves sold since then, an estimated 2 million. For details about the recall, QuickCook microwave owners should call (800) 995 6743 and have the serial number from the back of the microwave ready when calling. Copyright 2011The New York Times Company

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169 12: G ood country reputation x High country of origin salience x No response September 23, 2011, Friday, Final Edition Mitsukoshi recalls microwave after explosions span the globe BYLINE: By Lydia Willams; Natsuko Ogawa contributed reporting for this article SECTION: Section B; Column 6; Business/Financial Desk; LENGTH: 397words DATELINE: Washington, D.C., September 23 Washington D.C. Representatives from Mitsukoshi, the major Japanese electronics company, headquartered in Tokyo, Japan, announced a global recall for an estimated over 2 million model QuickCook microwaves on Thursday. Mitsukoshi has been facing media scrutiny since mid September after 16 separate incidents of microwave explosions in the U.S., South America, Europe and Asia. The estimated cos t of the recall of the microwaves is more than $50 million. The explosions have occurred worldwide and caused major and minor injuries to over 22 people. One of the more severe reported injuries is third degree burns on the face and chest of a 19 year old Allison Gregory in Cleveland. recognize there is a problem with our QuickCook Microwaves and are deeply grieved to hear injuries of our customers have ure safety, we stand by our products and are Activist organizations have been formed on Facebook and Twitter questioning the quality of Japanese products and holding the country responsible for the explosions. However, while public opinion toward Japan and the quality of its products is getting worse, the Japanese government has not responded to the current product recall situation so far. This is the larges t microwave recall to date. The QuickCook microwaves have been on the market since April of 2009. For more information on the recall, call (800) 995 6743. Copyright 2011 The Wall Street Journal Company

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170 APPENDIX C QUESTIONNAIRE Q1. How do you feel about multinational companies which have headquarters in foreign countries? ( Multinational companies are business enterprise with manufacturing, sales, or service subsidiaries in one or more foreign countries) 1 = strongly disagree / 4 = neither agree nor disagree / 7 = strongly agree 1 2 3 4 5 6 7 Multinational companies contributes to the development of the U.S. economy Multinational companies are plundering capital in U.S. Multinational companies invest money to stimulate the growth of the economy of U.S. Multinational companies are not necessary for U.S. industry. Multinational companies' influence on U.S. business is negative. Multinational companies' products are excellent. Thank you for you r time to answer the questions in this study. Your participation and responses are voluntary, anonymous, and important to the success of this study. Please answer the following questions to the fullest. Where necessary, please give approximate responses.

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171 You will now read a short introduction of a multinational company and then two news articles regarding its product recall. (One of the manipulations goes here)

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172 Please carefully read the following articles. Once finished, you will be asked several questions. Please select the best answer that best matches how you fell about each statement. (One of the experiment stimuli goes here)

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173 Q2 & Q2 1 Please indicate your feeling a bout the following statement. 1 = strongly disagree / 4 = neither agree nor disagree / 7 = strongly agree 1 2 3 4 5 6 7 I think the country in the news articles has a good country reputation. 1 2 3 4 5 6 7 Others would think the country in the news articles has a good country reputation. Q 3 How close do you relate the company in the news article with its country of origin ? Strongly unassociated Unassociated Somewhat unassociated Neither associated nor unassociated Somewhat associated Associated Strongly associated 1 2 3 4 5 6 7 Q 3 1 How close do you think that others would relate the company in the news article with its country of origin ? Strongly unassociated Unassociated Somewhat unassociated Neither associated nor unassociated Somewhat associated Associated Strongly associated 1 2 3 4 5 6 7 Q 4 In the news article, how is the government country of origin responding to the allegation? A denial An apology 1 2 3 4 5 6 7

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174 Q 4 1. In the news article, how others would think the government country of origin responding to the allegation? A denial An apology 1 2 3 4 5 6 7 Q 5 Please indicate your feeling about the country in the news article by checking on the scale that best reflects your judgment. There are no right or wrong answers. We are only interested in how YOU perceive the country. 1 = strongly disagree / 4 = neither agree nor disagree / 7 = strongly agree 1 2 3 4 5 6 7 People are well educated. Places emphasis on technical/vocational training. People are hard working. People are creative. People are friendly and likeable. Technical skills of workforce are high. Friendly toward my country in international affairs. Actively participates in international affairs. People are motivated to raise living standards. People are proud to achieve high standards.

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175 Q 6 How do you feel about products of the country in the news articles in general? 1 = strongly disagree / 4 = neither agree nor disagree / 7 = strongly agree 1 2 3 4 5 6 7 Products are innovative. Products are good looking (stylish). Products are good performers (reliable). Products are in need of frequent repairs (heavy maintenance). Products are long lasting (durable). Products are easy to get service in the U.S. Q 7 Please indicate your feeling about each sentence regarding products of this country in the news articles in general. 1 = very unlikely / 4 = undecided / 7 = very likely 1 2 3 4 5 6 7 How likely would you purchase this country's products? How likely would you think others will purchase this country's product? How likely would you rate the quality of this country's product is satisfactory? How likely would you recommend this country's products to a friend of yours?

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176 Q 8 Please indicate how you feel about the company in the news article s 1 = strongly disagree / 4 = neither agree nor disagree / 7 = strongly agree 1 2 3 4 5 6 7 I have good feeling about the company. I trust the company. The company offers high quality products/services. The company is ethical. Looks like a company strong prospects for future growth Looks like this company meets global standards Q 9 Please indicate your feeling about each sentence regarding the products of the company in the news article. 1 = very unlikely / 4 = undecided / 7 = very likely 1 2 3 4 5 6 7 How likely would you purchase this company's products? How likely would you think others will purchase this company's product? How likely would you rate the quality of this company's product is satisfactory? How likely would you recommend this company's products to a friend of yours?

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177 The following questions ask for some general demographic information. Please select the appropriate response or fill in the blank as needed. This study is completely anonymous, and the information you provide will be only used for statistical purpose. Gender: Male [ ] Female [ ] Age: [ ] Education level: Freshman [ ] Sophomore [ ] Junior [ ] Senior [ ] Ethnicity: African American (non Hispanic) [ ] White (non Hispanic) [ ] Hispanic [ ] Asian or Pacific Islander [ ] Native American [ ] Other (Please specify) [ ] Thank you for your participation.

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178 LIST OF REFERENCES

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190 BIOGRAPHICAL SKETCH Hyun Ji Lim is originally from Seoul Republic of Korea She holds a B.A. in Mass Communication (Advertising and Public Relations) from Ewha Womans University in Seoul, South Korea and a M.A. in Mass Communication ( Public Relations ) from the University of Florida While in her doctoral program, she taught Public Relations Research (PUR3500) at the University of Florida. As a mass communications scho lar with a focus in public relations, Hyun s research interests are how public relations efforts can lead to social contributions. More specifically, she is interested in international public relations, public diplomacy, and crisis communication strateg y She will join the Department of Communication at Jacksonville University in the fall of 2012.