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French Wine and the U.S. Boycott of 2003: Does Politics Really Affect Commerce?

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  • Ashenfelter, Orley
  • Ciccarella, Stephen
  • Shatz, Howard J.

Abstract

In early 2003, France actively tried to thwart the plans of the Bush administration to build international support for a war to depose Iraqi ruler Saddam Hussein. In response, calls in the United States for a boycott of French products, wine in particular, rebounded through all forms of media. In the spring of 2003, French business people even reported that the boycott calls were hurting their U.S. sales. Using a dataset of sales of nearly 4,700 individual wine brands, we show that there actually was no boycott effect. Rather, sales of French wine dipped for two reasons. First, they experience a cyclical peak at holiday time, from November through early January, and the boycott was called during the February to May period. Second, sales of French wine have been in a secular decline in the United States. Sales in February through May 2003 merely stayed on trend. We contrast our results with other recent work that has found evidence of a boycott effect but that omits the holiday effect from several specifications. French wine producers may be having economic problems, but it is not because of their government's foreign policy. (JEL classification: D12, F14, L66, Q17)

Suggested Citation

  • Ashenfelter, Orley & Ciccarella, Stephen & Shatz, Howard J., 2007. "French Wine and the U.S. Boycott of 2003: Does Politics Really Affect Commerce?," Journal of Wine Economics, Cambridge University Press, vol. 2(1), pages 55-74, April.
    • Handle: RePEc:cup:jwecon:v:2:y:2007:i:01:p:55-74_00
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    References listed on IDEAS

    as
    1. Bentzen, J. & Smith, V., 2001. "Did the French Nuclear Tests under the Muroroa Atoll Affect the Export of French Wine to Denmark?," Papers 01-9, Aarhus School of Business - Department of Economics.
    2. Larry Chavis & Phillip Leslie, 2009. "Consumer boycotts: The impact of the Iraq war on French wine sales in the U.S," Quantitative Marketing and Economics (QME), Springer, vol. 7(1), pages 37-67, March.
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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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