Reprisals Remembered: German-Greek Conflict and Car Sales During the Euro Crisis
45 Pages Posted: 17 Oct 2013 Last revised: 26 Sep 2016
Date Written: September 2016
Limited attention and selective memory are important forms of cognitive bias. We investigate how present events trigger selective recall, thereby changing economic behavior. The 2010-14 sovereign debt crisis in Greece created massive political conflict between the German and Greek governments. During the same period, German car sales declined sharply. Effects differed according to the actions of German troops during the occupation of Greece, 1941-44. Declines in German market share were much larger in areas where the Germans carried out massacres. Current events can reactivate past memories selectively, even in the same country, having a large effect on purchasing behavior.
Keywords: consumer boycott, memory, political conflict, car sales, Euro crisis, German–Greek relations
JEL Classification: D12, D74, F14, N14, N44
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