When states punish foreign firms during international disputes, enforcement often depends on subnational implementation. Yet why does it vary so sharply across localities? We argue that subnational governments exploit geopolitical crises as distributive openings, boycotting firms from adversarial countries to signal political loyalty while redirecting government purchases toward locally embedded producers. Using China’s 2012 anti-Japan crisis and nationwide vehicle registration data, we show that government demand for Japanese vehicles fell by 25 percent and remained depressed through 2013, while consumer boycotts were smaller and short-lived. The government boycott was strongest where cities had auto-industry ambitions or politically insecure leaders. Cities with locally embedded automakers redirected demand toward these producers, either shielding local Japanese brands or supporting non-Japanese competitors. These patterns appear exclusively in organizational purchases, not consumer demand, suggesting that government purchasing is a durable but overlooked instrument of subnational economic statecraft.
Shengqiao Lin is an Assistant Professor of Political Science at the University of Toronto Mississauga. His research examines Chinese political economy, with a focus on state-business relations, regulatory politics, and economic statecraft. His work has appeared in the Journal of Politics, International Studies Quarterly, World Development, and Journal of Contemporary China, among others, and has been recognized with APSA’s Franklin L. Burdette Award. Before joining Toronto, he was an A Wang Postdoctoral Fellow at Harvard’s Fairbank Center and a postdoctoral fellow at the Harvard Kennedy School. He received his PhD in Government from the University of Texas at Austin.
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