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A Theory of International Boycotts

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  • Abdoulaye Ndiaye

Abstract

This paper provides the first systematic analysis of international boycotts within a neoclassical Ricardian framework. I establish a general equivalence result that equilibrium outcomes with boycotts can be analyzed through either the fixed factor demands or fixed expenditures of the boycotting coalition, thereby clarifying the economic mechanisms behind boycotts. Optimal boycotts (i) take the form of prohibitions on importing foreign goods unless foreign comparative advantage is sufficiently large, and (ii) boycotters optimally increase labor supply to spend more on domestic goods. International boycotts are equivalent to certain forms of government-imposed sanctions or voluntary export restrictions, although their effectiveness is diminished by leakage effects from nonboycotting consumers. Thus, while boycotts share key similarities with conventional trade policy instruments, they introduce complexities that position them as distinct tools of geoeconomic influence.

Suggested Citation

  • Abdoulaye Ndiaye, 2024. "A Theory of International Boycotts," CESifo Working Paper Series 11267, CESifo.
    • Handle: RePEc:ces:ceswps:_11267
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    References listed on IDEAS

    as
    1. Christopher Clayton & Matteo Maggiori & Jesse Schreger, 2023. "A Framework for Geoeconomics," NBER Working Papers 31852, National Bureau of Economic Research, Inc.
    2. James R. Hines, Jr., 1997. "Taxed Avoidance: American Participation in Unsanctioned International Boycotts," NBER Working Papers 6116, National Bureau of Economic Research, Inc.
    3. Suzanne C. Makarem & Haeran Jae, 2016. "Consumer Boycott Behavior: An Exploratory Analysis of Twitter Feeds," Journal of Consumer Affairs, Wiley Blackwell, vol. 50(1), pages 193-223, March.
    4. repec:bla:econom:v:72:y:2005:i:285:p:1-16 is not listed on IDEAS
    5. Clayton, Christopher & Maggiori, Matteo & Schreger, Jesse, 2023. "A Framework for Geoeconomics," SocArXiv cxwmr_v1, Center for Open Science.
    6. Zijun Luo & Yonghong Zhou, 2020. "Decomposing the effects of consumer boycotts: evidence from the anti-Japanese demonstration in China," Empirical Economics, Springer, vol. 58(6), pages 2615-2634, June.
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