Foreign Direct Investment and Civil Rights: Testing Decreasing Returns to Civil Rights

Ponce, Aldo (2010): Foreign Direct Investment and Civil Rights: Testing Decreasing Returns to Civil Rights.

Abstract

In this paper, I examine the effectiveness of improvements in political and civil rights for attracting foreign direct investment flows (FDI) into democracies. I contend that advances in the quality of democracy – specifically those concerning civil rights – present positive but decreasing marginal returns in attracting FDI inflows. I empirically prove this proposition by using panel data regressions within the Latin American and Eastern European contexts from periods following their democratization (1991-2003).

• Item Type: MPRA Paper
• Language: English
• Keywords: foreign direct investment, civil rights, democratization, developing nations, Latin America, Eastern Europe
• Subjects: K - Law and Economics > K1 - Basic Areas of Law > K12 - Contract Law; K - Law and Economics > K0 - General > K00 - General; F - International Economics > F2 - International Factor Movements and International Business > F21 - International Investment ; Long-Term Capital Movements; K - Law and Economics > K1 - Basic Areas of Law > K11 - Property Law; K - Law and Economics > K3 - Other Substantive Areas of Law > K31 - Labor Law; P - Economic Systems > P5 - Comparative Economic Systems > P52 - Comparative Studies of Particular Economies

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