DP8041 The Impact of the Iraq War on US Consumer Goods Sales in Arab Countries

Author(s): Sofronis Clerides, Peter Davis, Antonis Michis
Publication Date: October 2010
Date Revised: November 2011
Keyword(s): consumer behavior, consumer boycotts, Iraq war
JEL(s): D01, D12, L66
Programme Areas: Industrial Organization
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=8041

Did the rise in anti-American sentiment caused by the Iraq war a ffect sales of US goods abroad? We address this question using data on soft drink and fabric detergent 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 impact market outcomes.