Abstract: With the increasing trend of globalization, film, a representative cultural product, is affected by home bias in international trade. Taking movies as an example, this paper examines how adding host country elements to cultural products to cater to their market tastes breaks through the constraint mechanism of home bias in international trade by constructing the theoretical derivation of the Armington model, which includes two dimensions of product home bias and product quality, and aggregating the empirical test of the data of foreign revenue sharing films introduced in 1994-2019. Consistent with the theoretical model conclusion, the empirical results show that after controlling for film quality, shooting on Chinese locations or staffing more Asian actors has a positive effect on boosting box office in the Chinese market; while staffing Chinese actors in the main cast has little effect on box office, and indeed the inclusion of Chinese actors in the male and female leads has a significant negative effect. Robustness tests based on the European market yields consistent conclusions. Interestingly, European leads and directors show a positive contribution to the box office of foreign films in Europe. Further analysis reveals that the inclusion of Chinese actors in lead roles reduces the quality of foreign films, while other factors have no effects on film quality. This further supports that the positive effect of incorporating Chinese elements on the box office of foreign films in China is independent of product quality. The results of this study not only provide a theoretical basis for cultural products to break through the home bias mechanism in international trade, but also help inspire Chinese cultural products to go abroad and enhance China's cultural influence through overseas filming, staffing more overseas faces, and staffing internationally recognized overseas actors.

Key words: foreign films, Chinese elements, home bias, box office