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We study the impact of nationalism and interstate frictions on international economic relations by analyzing market reaction to adverse shocks to Sino-Japanese relations in 2005 and 2010. Japanese companies with high China exposure suffer relative declines during each event window; a symmetric effect is observed for Chinese companies with high Japanese exposure. The effect on Japanese companies is more pronounced for those operating in industries dominated by Chinese state-owned enterprises, whereas firms with high Chinese employment experience lower declines. These results emphasize the role of countries' economic and political institutions in mediating the impact of interstate frictions on firm-level outcomes. [ABSTRACT FROM PUBLISHER]

During August and September 2012, Sino-Japanese conflict over the Diaoyu/Senkaku Islands escalated. Alongside street demonstrations in China, there was an outpouring of public sentiment on China's leading micro-blog, Sina Weibo (微波). Using human and computer-assisted content analysis, we exploit original Weibo data to measure how public sentiment in China fluctuated over the dispute, and ask two questions. First, how cohesive and volatile were online nationalist sentiments? Second, we measure government censorship of Weibo in order to ask which sentiments did authorities allow to be expressed, and when? We first find that many of the micro-bloggers' harshest invective was directed not at Japan but at their own government. Second, while censorship remained high across topics for most of the dispute, it plummeted on 18 August – the same day as bloggers' anger at Beijing peaked. These observations suggest three theoretical explanations: two are instrumental-strategic (“audience costs” and “safety valve”) and one is ideational (elite identification with protesters). [ABSTRACT FROM PUBLISHER]

This article examines the role of public opinion in Japan in directly influencing the Japanese government's decision to nationalize the Senkaku Islands in 2012. The public mood in Japan is becoming increasingly nationalistic. Although this does not immediately mean the return of militarism in the country, such a mood is especially evident with respect to China. The nationalization of the Islands took place within this nationalistic domestic environment. In the case of the nationalization, public opinion was channeled most notably through Tokyo Governor Ishihara. His plan to purchase the Islands and strong public support for his plan eventually forced the central government's intervention. Prime Minister Noda simply could not force Ishihara to give up his plan because going against such a popular politician who was enjoying strong public support would almost certainly have caused a strong public backlash and resulted in electoral punishment. On the other hand, Noda was also concerned that Tokyo's successful acquisition of the Islands would lead to severe criticism of his government for not properly protecting Japan's territorial integrity. There was also a more serious concern that Ishihara's control of the Islands might lead to a change of the status quo and thus dangerously provoke China. Therefore, Noda had no choice but to intervene and nationalize the Islands. If he was also seeking to mobilize public opinion in his favor, he was not entirely successful. [ABSTRACT FROM AUTHOR]

The article focuses on the dispute that involves the People's Republic of China (PRC), the Republic of China (ROC) on Taiwan, and Japan over the ownership of the Diaoyutai/Senkaku islands. It states that this dispute is fueled by the symbolic significance of the islands to the parties involved due to domestic pressures instead of a desire for natural resources. This article suggests that the three countries in the dispute should understand the importance of nationalism for their individual domestic politics.

Evaluates the role of nationalism in increasing the chances of international conflict as illustrated by the developing tension between China and Japan over territorial claims for the Senkaku Islands. Use of nationalism to divert attention from the state's inability to meet society demands for security, economic development and effective political institutions; Expansionist and militaristic goals of states.

The nationalization of the Senkakus opened a Pandora's box of conflicting sovereignty claims that Japan will not be able to close without either conceding on key issues regarding the administration of the islands and surrounding waters or risking a sustained escalation of the dispute. By analyzing Japan's political landscape, the strategic objectives of the People's Republic of China, the goals of the Republic of China (Taiwan), and the nationalism-driven militarization of the region, this article explains why the current dispute over the Senkakus is likely to be a protracted one. [ABSTRACT FROM AUTHOR]