Implications of the World Health Organization (WHO) regulations concerning the sales of breast milk substitutes and country-specific indicators per the diamond location theory: A multi-country analysis

Abstract

Although multinational firms have placed considerable efforts to improve the safety profile of infant formula milk to best mimic breastmilk, the negative health impacts for both mother and baby remain a threat. For this reason, the World Health Organization launched a demarketing initiative, the International Code of Marketing of Breast-milk Substitutes, to curb the demand for infant formula milk across the globe. This study purposed to investigate the implications of such restrictive regulations on the sales of infant formula milk using a quantitative, multi-country study design. Using the Porter's Diamond Location Theory as the underpinning study framework, data was extracted from secondary sources to test eight hypotheses, mainly around key relationships between the scale of sales of infant formula milk and other independent variables. The study had a number of revelations pointing to direct and/or indirect implications. The scales of sales of infant formula milk were significantly lower in countries with stringent restrictions. Lower sales were also seen in countries with lower innovation indexes, poor water quality, and those with higher fertility rates. Secondary findings resurfaced the central roles of ethics and equity which have long plagued demarketing strategies. This paper offers pragmatic usefulness to firms wanting to gain competitiveness in the infant formula industry. Furthermore, there is academic, policy, and methodological significance concerning demarketing strategies and national competitive advantage theories. At the end, six spheres of recommendations are offered to businesses, policymakers, and scholars.