Politics and Foreign Direct Investment

For decades, free trade was advocated as the vehicle for peace, prosperity, and democracy in an increasingly globalized market. More recently, the proliferation of foreign direct investment has raised questions about its impact upon local economies and politics. Here, seven scholars bring together their wide-ranging expertise to investigate the factors that determine the attractiveness of a locale to investors and the extent of their political power. Multinational corporations prefer to invest where legal and political institutions support the rule of law, protections for property rights, and democratic processes. Corporate influence on local institutions, in turn, depends upon the relative power of other players and the types of policies at issue.

Nathan M. Jensen is Associate Professor of Political Science at Washington University in St. Louis.

Glen Biglaiser is Associate Professor of Political Science at the University of North Texas.

Quan Li is Professor of Political Science at Texas A&M University.

Edmund Malesky is Associate Professor of Political Science at Duke University.

Pablo Pinto is Associate Professor of Political Science at Columbia University.

Santiago Pinto is Research Economist at the Federal Reserve Bank of Richmond.

Joseph L. Staats is Associate Professor of Political Science at the University of Minnesota, Duluth.