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

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.


Background
Boarder between countries is a sensitive issue and tends to prevent freedom of movement [1] [2]. However, there has been a long tradition of free movement of people across the borders. The last decades have seen a proliferation of institutionalized cross-border cooperation structures around the world [3]. People Cross-border cooperation is becoming an increasingly important factor in establishing a stimulating business environment that includes different levels of cooperation between regions of neighboring states [5]. Cross-border activities are increasing due to various beneficial motives such as easy entrance through borders, economical price of the commodities, easy purchase-sell activities, common and understandable language, cultural similarities, family relations across the border and trust. Without strengthening cultural cross-border relation, it is impossible to build strong links and cooperation between neighboring nations [6].
India and Nepal have shared intense people-to-people relations for a very long time [7] as geographical factors have been reinforced by religious, cultural and ethnic affinities between the inhabitants of the Terai region and their counterparts across the border [8]. As close neighbors, India and Nepal share a unique relationship of friendship and cooperation characterized by open borders and deep-rooted people-to-people contacts of kinship and culture [9]. [10] opined that migration between India and Nepal has been easy due to an open, porous border and strong familial link. [11] rightly remarks that the effects of a border on economic interaction depend on the nature of that border with respect to the degree of openness, the degree of cultural, racial and linguistic differences, political relations between the respective regions and the degree of economic disparity. The Indo-Nepal Treaty of Peace and Friendship 1 of 1950 is a bilateral treaty signed on July 31, 1950 between Nepal and India [9] [12] [13]. The treaty has played a vital role in establishing a close relationship between the two South Asian neighbors and allows for the free movement of people and goods between the two nations and a close relationship and collaboration on matters of defense and foreign affairs [14]. 1 Article 7 of the Treaty states-The Governments of India and Nepal agree to grant, on a reciprocal basis, to the nationals of one country in the territories of the other the same privileges in the matter of residence, ownership of property, participation in trade and commerce, movement that privileges of a similar nature (Kansakar, 2001 factor" between each other in times of well-being and distress.
All the given studies focus on some political and social context and less discuss in cross border purchase. Hence, socio-cultural and economic effects on cross-border purchase lack comprehensive research. The present study, thus, aims to undertake a comprehensive analysis of the socio-cultural and economic factors affecting cross border purchase in Sunauli-Nepal/India border.
The remaining section is organized as follows: the second section follows with the materials and method used, third section supports the result and discussion and the last section provides concluding remarks.

Study Area
This study was performed in Sunauli-India/Nepal border 3 [14].
Nepal shares border 768 miles with Chinese territory and in the North while 1089 miles to India in the East, West and South [13]. Based on the geographical proximity and access, Nepal has greater connectivity to India with 22 official checkpoints whereas China has only 6 official ports, which even do not function as intense and smooth as Indian checkpoints [7]. It is because northern part of The study area selection is based on purposive sampling 4 . The reason behind 3 Sunauli is located in 70 kilometers north of Gorakpur, India and 3 kilometers south of Bhairahawa, Nepal.
selecting purposive sampling in this study has two main reasons: the population is unknown and likely to change time and again; and visit of the people across the border from both country is not recorded as it is open border and people can stay as long as they want in both side of the border. [21] argued that purposive sampling can be very useful in situations when researcher needs to reach target sample quickly and sampling, for proportionality is not the main concern.
However, caution has been taken to select the people who have visited and are willing to cross the border 5 for purchase.  Table 2).

Theoretical Framework
Border interaction is affected by large number of variables which is basically of social, cultural, economic and political nature [5] [11] [17] [18]. These border phenomena can be analyzed categorizing into three theoretical approaches-the flow approach, the cross border cooperation approach and the people approach [1].
First approach focuses on the physical flow of goods, services and people across the border; second focuses on the analysis of border region and institution that allows for interaction and economic development while the last one is based on social-construction, identity and culture [11] [22]. The flow approach views border as an artificial barrier and restriction is taken as economic loss.
When border is in periphery, decisions are made for in the center of the nation and government may not be able to address the local context (scenario) [1] [23].
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, results in great loss of revenue.
The cross-border cooperation approach views peripheral region as frontiers for intense economic activities and emphasizes on cross border co-operation and 5 In this survey, 16 of the respondents have been found not crossing the border but willing to purchase in the future.
strategies to overcome differences [1] [11] [23]. [24] refers cooperation as "an opportunistic strategy for obtaining public subsidies". [25] believes that the cross border cooperation can boost the economic development between the neighboring countries. Additionally, [26] believe homogenization and culture affect marketing decisions and [27] focus on coherent activities of government public and business as essential to address socio economic and environmental problems. [28] points out three main challenges about the cooperation in cross border areas like pre-conceptions, socio-economic differences and distance to the center from periphery. The cross border cooperation between Nepal and India involves deep rooted multiple identities. The institutionalized agencies can work in territorial strategies, policy documents and cooperation between center and periphery. There is increasing importance of cross border cooperation [29].
The people approach views border not as lines in space but as socially con-

The Empirical Framework
For this study, binary Logit Regression Model was performed to identify the significant variable that determines consumers purchasing activities across the border with several other explanatory variables. Suppose Y is dichotomous variable assigned 0 for customer who has not purchased across the border and 1 involved on purchasing activities and X meant the socio-cultural and economic factors as mentioned in Table 1. The effect of X on the response probabilities, P (y = j/x) can be estimated by using binary logit model of [34] [35] as: The logit regression equation that is used to ascertain variables influencing U. R. Paudel et al.

Socio-Cultural Characteristics of the Customers Purchasing Cross-Border
In this study, a majority of the respondents 78% were male and 22% of them In the research, out of 429 respondents, 68.38% of them purchase general goods across the border followed by garment products (21.86%), store goods (19.06%), cosmetic products (7.4%), medicines (5.58%), hardware (4.65%) and insignificant others. It indicates that border customers mostly purchase the goods for daily household needs. These goods are generally available in their locality, as 71.2% stated, however they purchase such goods across the border for several reasons due to cheaper goods (65.1%), quality goods (41.2%), geographical proximities coupled with cultural homogeneity (20.7%), habituated (3%), friends-circle (3.5%) and so on.
In the border area, customers' movements' increase in the festivals commonly celebrated in both the nations-Tihar (Diwali in India), Dashain (Dahsera in India), Chhath, and Holy. Besides seasons and festivals, relatives living another sides of the border, their languages, customs and practices also influence for cross border purchase [5] [17]. In the research, 43.2% of the total respondents argued they have various relatives on the other sides of the border which are promoting purchase across the border. Their status of relationship is observed as blood-relationship (17.4%), friends-circle (15.1%), marriage (7%) and others (3.7%). Additional to relationship, respondents also believed common language helping them to purchase as 84.4% respondents agreed their purchase was easy due to similarity in languages. 51.6% of the total respondents opined that it is easy to purchase without cheating with the similar dress code but another 48.4% did not agree to this proposition. Communication in border area is another important influencing aspect for cross-border purchase [4] [5]. As [1] opined that effective level of communication makes purchase much better in border area. The result of the survey also shows that in Sunauli-Bhairahawa border area, 71.6% of the respondents believed in the easy access of communication. Among such communication medium, mouth-to-mouth communication (90.9%) were found mostly used in compared to mobile (5.1%) and others (4%). As a result, 69.5% of them argued that such easy access to communication has helped to improve their purchase.

Economic Characteristics of the Customers Purchasing Cross-Border
This study observed very long evidence of purchasing goods across the border that ranges from less than a year to 60 years. It indicates that border activities for purchasing goods are quite a long phenomenon. Also, 90% and above respondents, who have been to purchase goods across the border, informed that they have good information about market and goods which they have been purchasing across the border. A majority of respondents (85.6%) purchase goods across the border believe that goods available across the border are economical to purchase. Half of the respondents tell that goods are economical while the remaining respondents do not agree to the situation. The study reveals that a respondent spends in an annual average NRs 206,615 in purchasing across the border.
The purpose of this purchase ranges from households' consumption goods to business intension.
Mostly customers purchase from different shops of their convenience but 35% of the consumers purchase from the same shop due to various reasons like credit facilities and their relationship across the border. 53.7% customers' purchase from the same shop receives credit facilities up to a month. Due to various reasons, customers prefer to purchase on the Indian side of the border. In the research, it is observed that they give preference to purchase Indian side of the border as 45% consumers reveled their opinion to purchase only Indian side of the border and another 45% want to purchase both sides of the border and rest 10% prefer to purchase Nepal side of the border. In this context, 90% respondents believe economical price is the main factor for the greater volume of purchase in Indian side.

Open Border Factors Affecting Cross-Border Purchase
Open border is considered equally important factor for the customers who has involved in such cross-border purchasing activities. Out of the total respondents,

Regression Analysis
This study is based on cross-sectional data. [  Regression result reveals that there is significant relationship in cross-border purchase and small deviation in the peoples' daily activities and their perception towards goods, prices, relationship and other issues may affect their purchase badly and also could bring lethargic to the people who is purchasing and willing to purchase across the border. It is therefore necessary to ponder on such issues from both sellers and policy makers so that the cross-border purchase last long with their mutual interest, cultural and social harmony. It would further help to strengthening border areas peoples' socio-cultural and economic relationship along with border sharing countries. Additionally, it helps to reduce anti-border activities.

Concluding Remarks
Nepal and India have a very long bilateral relationship in many aspects. The 6 Collin Test against Breusch-Pagan Test for multicollinearity is used in this analysis as [39] argued that Collin test allows direct estimation of multicolliniarity after logit regression whereas Breusch-Pagan Test reqires OLS estimation. 7 Higher percentage in classification table values provides better fit of the model [37]. 8 This study also used probit model to cross check the result received from logit model. to easy access to communication, 71.6% people prefer to purchase across the border. Open border factor is equally important to stimulate cross border purchase as 54.6 of the respondents agreed that they purchase goods across the border due to hassle free border movements. Following the analysis, the study results in positive influence of socio-cultural characteristics in cross-border purchase.
The findings from logistic regression indicate that goods available in local To conclude, the emphasis should be based on perception of the people, harmony, trust, trade relation and international brotherhood for the sustainability of peaceful border activities, which the researchers believe will enhance and nurture cross-border purchase activities. Border hurdles should be jointly solved to enhance cross-border purchase and to minimize the growing political agitation of the people. The key areas of fair bilateral coverage, co-existence, mutual respect and cross-border connectivity should be preserved in pursuit of progress and optimizing mutual benefits. As the border areas in Nepal-India are far from central governments, their importance in terms of socio-cultural, historical and economic aspects should not be neglected.