Political conflict and angry consumers: Evaluating the regional impacts of a consumer boycott on travel services trade.

SOUTH Korea; JAPAN

• Political conflict between nations can lead to angry consumers and calls to boycott. • Korean consumers boycotted travel to Japan in 2019 after a bilateral dispute arose. • The travel boycott had regionally heterogeneous effects on Japanese prefectures. • Regions with high pre-boycott dependency on Korean visitors suffered larger losses. • Regions dependent on Korean tourists in particular bore disproportionate effects. Political conflict between nations sometimes leads to consumer boycotts. We examine the regional impacts of bilateral boycott activity by investigating the 2019 Korean consumer boycott of travel to Japan. Employing triple- and double-differences designs, we find that the impact of the boycott is large and regionally heterogeneous. Japanese prefectures with high (i.e., 75th percentile) pre-boycott dependency on visitors from Korea suffer bilateral export losses of 56.9 to 60.9 percent and aggregate export losses of 10.5 to 13.3 percent. Prefectures with low (i.e., 25th percentile) Korea dependency experience bilateral losses of 47.8 to 49.7 percent and aggregate losses of 3.3 to 4.2 percent. [ABSTRACT FROM AUTHOR]

Copyright of Journal of the Japanese & International Economies is the property of Academic Press Inc. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)