The efficiency of a boycott campaign: the case of BDS

Abstract

This study evaluates the effectiveness of the Boycott, Divestment, and Sanctions (BDS) movement’s boycott strategy by examining its impact on targeted firms’ stock prices. Two methods are employed: a short-term event study with 20-day windows around boycott announcements, which produces inconclusive results due to methodological limits, and a synthetic difference-in-differences approach comparing boycotted firms with synthetic clones built from similar competitors. The latter indicates significant negative effects on stock prices at three, six, twelve, and twenty-four months after announcements, though robustness is limited by the small sample size, which raises the risk of outliers and idiosyncratic effects. Overall, the findings suggest that while synthetic difference-in-differences is a promising tool for assessing long-term financial impacts of boycotts, the current evidence remains preliminary, and further research with larger samples and stronger robustness checks is needed to draw firm conclusions about the economic effectiveness of BDS campaigns.