Drawing from cognitive learning theories we hypothesize that exposure to nationalistic appeals that suggest consumers should shun foreign brands for moral reasons increases the general belief in consumers that buying foreign brands is morally wrong. In parallel, drawing from the theory of psychological reactance we posit that such appeals may, against their communication goal, increase the reputation of foreign luxury brands. We term the juxtaposition of these apparently contradictory effects the “Ambivalence Hypothesis.” Further, drawing from prior research on source-similarity effects (...) we posit that foreign luxury brands that communicate cultural proximity to target consumers (i.e., a local brand positioning) reinforce psychological reactance (“Clean Conscience Hypothesis”). We test these hypotheses experimentally in the context of luxury car brand advertising in China, a market that is heavily dominated by foreign brands, and therefore provides a breeding ground for ambivalent consumer reactions. Results show that exposure to nationalistic appeals enhances consumers’ national identity dispositions (patriotism, local identity), which results in higher levels of consumer ethnocentrism. Further, nationalistic appeals enhance the social responsibility associations that consumers hold for foreign luxury brands and their countries of origin, which results in a higher brand reputation. Finally, effects of nationalistic appeals on foreign luxury brand reputation are positively stronger for brands using a local vs. a foreign or a global positioning. These findings suggest that nationalistic appeals are a double-edged sword with important implications for ethics in political communication and luxury brand marketing. (shrink)