This paper contributes to research on nonmarket strategy and legitimacy maintenance in contexts of weak state capacity by showing how one of the world’s largest mining firms struggled to maintain legitimacy in local communities after legitimation through nonmarket activity. Based on data collected during nine months of fieldwork in Peru’s mining industry, the article advances a theoretical model of a legitimation trap. The model encapsulates how the delivery of public goods and services to community stakeholders as nonmarket strategy raised stakeholder expectations for more nonmarket activity, forcing the firm to sustain nonmarket activity solely to maintain legitimacy and avoid community opposition. The paper also shows how the private delivery of public goods and services instead of the state eroded state legitimacy in terms of public goods and services delivery in the communities, increasing legitimacy maintenance pressure on the firm. These findings have implications for how we study firms operating in contexts of low state capacity, and what roles firms can sustainably play instead of states.
