Stigmatized Categories and Public Disapproval of Organizations: A Mixed Methods Study of the Global Arms Industry (1996–2007)

Using qualitative and quantitative methods, the paper draws on the categorization and stigmatization literatures to predict the amount of negative social evaluations received by firms, i.e. disapproval. Association with a stigmatized category does not automatically result in disapproval, because straddling multiple categories dilutes stakeholder attention from the stigma. Findings highlight how managers can modify categorical associations at the industry and customer levels to decrease disapproval, and I discuss implications for diversification and internationalization strategies. Results also show that 9/11 modified the saliency of the categories used by arms industry stakeholders. Finally, the paper suggests that stigmatized industries manage to thrive in the long run despite stigmatization thanks to their members’ category straddling behavior, which makes social evaluations more neutral (less negative).