Socio-Cultural and Economic Factors in Cross-Border Purchase: A Study of Customers’ Perspective in Sunauli-Nepal/India Border

Abstract

Nepal and India sustain bilateral relationship and share social, cultural, economic, political and geographical proximities contributing people of both nations to a number of advantages. This study analyzes socio-cultural, geo-political, and economic proximities contributing people of Sunauli-India/Nepal border exploiting purposive sampling in 429 respondents with a structured questionnaire survey in February 2018. Descriptive and inferential data analysis techniques are performed along with Logistic Regression Model to interpret the determinants of cross-border purchase. The result revealed 96.3% of the total respondents involved in purchase, out of them, 85.6%, 77.2%, 71.6%, 71.2% and 54.6% purchase due to economical price of the goods, festivals, communication access, habit and open border factors respectively. The empirical results of the binary logistic regression models revealed different effects of the factors on customers cross border purchase. Economical goods (2.727***), hassle free cross-border imports (1.952***), language similarities (1.551**) and goods available in local market (1.268**) significantly and positively affect the cross-border purchasing activities and the Odds Ratio of given variables is 15.28, 7.04, 4.71 and 3.55 respectively. Following the analysis, the study concludes that there is positive influence of socio-cultural characteristics in cross border purchase. Open border factor is equally important to stimulate such purchasing activities. More than other factors, economic characteristics as availability of goods, their types and economical price are all in all important.

Socio-economic influences on small business performance in Nepal–India open border: Evidence from cross-sectional analysis

“…In the context of Nepal-India border, peripheral areas cause intense economic activities where people from the border area cross more frequently than people away from the border. Obstacles like border blockade, even for the short period of time, result in great loss of revenue (Paudel et al, 2018).…”

“…4 Based on discussion with local government authorities and researchers' observation. Udaya Raj Paudel, Niranjan Devkota and India (Paudel et al, 2018). The study area selection is based on purposive sampling 5 .…”

“…Singh (2007) argued that purposive sampling can be very useful in situations when researcher need to reach target sample quickly and sampling, for proportionality is not the main concern. As Paudel et al (2018) conduct their first research based on perception of people towards cross border purchasing activities; this research is the continuation with the small shopowners regarding the influence of open border to their small business activities.…”

“…Due to cross border effects of goods and services, businessmen in the Nepal side of the border offer general store (31%), garments (18%), cosmetics (12%), hardware (8%), medicine (8%) and others (28%). As customers want to purchase many goods in Indian side of the border, businessmen of this area are less Udaya Raj Paudel, Niranjan Devkota concentrated and offer goods which are also offered by the shopkeeper of Indian side (Paudel et al, 2018).…”

“…Small businesses are common in border areas of nations and result more in openborder sharing situations (Paudel, Devkota & Bhandari, 2018). The cross-flow of people and business are proliferated in open-border boosting local market in both sides (Walther, 2014).…”