National Sentiment and Consumer Choice: The Iraq War and Sales of US Products in Arab Countries
Davis, Peter J.
SourceScandinavian Journal of Economics
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Did the rise in anti-American sentiment caused by the Iraq war affect sales of US goods abroad? We address this question using data on soft drinks and fabric detergents sales in nine Arab countries. We find a statistically significant negative impact of the war on sales of US soft drinks in seven countries. The impact dissipates after a few months in two countries but persists in the other five. In the case of detergents, we only find a significant negative impact in one country. We conclude that international politics can sometimes affect consumer behavior and market outcomes. © The editors of The Scandinavian Journal of Economics 2015.