The flow of foreign direct investment into developing countries varies greatly across countries and over time. The political factors that affect these flows are not well understood. Focusing on the relationship between trade and investment, we argue that international trade agreements-GATT/WTO and preferential trade agreements (PTAs)-provide mechanisms for making commitments to foreign investors about the treatment of their assets, thus reassuring investors and increasing investment. These international commitments are more credible than domestic policy choices, because reneging on them is more costly. Statistical analyses for 122 developing countries from 1970 to 2000 support this argument. Developing countries that belong to the WTO and participate in more PTAs experience greater FDI inflows than otherwise, controlling for many factors including domestic policy preferences and taking into account possible endogeneity. Joining international trade agreements allows developing countries to attract more FDI and thus increase economic growth. F oreign direct investment (FDI) by multinational corporations (MNCs) has grown rapidly in recent decades, 1 and developing countries have attracted an increasing share of it: $334 billion in 2005, or more than 36% of all inward FDI flows (UNCTAD 2006, xvii). Its importance for developing countries' economies also has increased, from an average of barely 1% of GDP in the 1970s to about 2.5% of GDP on average by 2000. Yet, the magnitude and especially the timing of increases in FDI into developing countries have varied greatly. What explains this variation?To answer this question, we develop a theoretical argument emphasizing political factors and empirically examine FDI flows into 122 developing countries. Since Tim Büthe (corresponding author) is assistant professor of political science, Duke University, on leave 2007-09 while a RWJ Foundation

This book examines the delegation of regulatory authority from governments to a single international private-sector body by focusing on three powerful global private regulators, or focal rule-making institutions: the International Accounting Standards Board (IASB), the International Organization for Standardization (ISO), and the International Electrotechnical Commission (IEC). The book shows how the simultaneous privatization and internationalization of governance is driven, in part, by governments' lack of requisite technical expertise, financial resources, or flexibility to deal expeditiously with ever more complex and urgent regulatory tasks. Its main argument is that technical expertise and financial resources are necessary but not sufficient conditions for successful involvement in global private-sector standardization. To make its case, the book explores global private regulation in global financial and product markets.

Standards have become one of the most important nontariff barriers to trade, especially national product standards that specify design or performance characteristics of manufactured goods. Divergent national standards often inhibit trade, whereas regional and international standards increasingly serve as instruments of trade liberalization. Consequently, the setting of international standards—seemingly technical and apolitical—is rapidly becoming an issue of economic and political salience. But who sets international standards? Who wins, who loses? This article offers a fresh analytical approach to the study of international standards, which the authors call the institutional complementarities approach. It builds on insights from realism and the “Battle of the Sexes” coordination game but emphasizes complementarities of historically conditioned standardization systems at the national level with the institutional structure of standardization at the international level. It posits that, after controlling for other factors that influence involvement in international standardization, differences in institutional complementarities play a critical though largely accidental role in placing firms from different countries or regions in a first- or second-mover position when standardization becomes global. The authors illustrate the insightfulness of this approach through statistical analyses of the first scientific set of data on standards use and standardization, collected by the authors through an international online survey.

S ocial scientists interested in explaining historical processes can, indeed should, refuse the choice between modeling causal relationships and studying history. Identifying temporality as the defining characteristic of processes that can be meaningfully distinguished as "history," I show that modeling such phenomena engenders particular difficulties but is both possible and fruitful. Narratives, as a way of presenting empirical information, have distinctive strengths that make them especially suited for historical scholarship, and structuring the narratives based on the model allows us to treat them as data on which to test the model. At the same time, this use of narratives raises methodological problems not identified in recent debates. I specify these problems, analyze their implications, and suggest ways of solving or minimizing them. There is no inherent incompatibility between-but much potential gain from-modeling history and using historical narratives as data.

This introduction to the special issue combines a review of the existing literature about the causes and consequences of private regulation in the global economy with a preview of the articles in this issue. To organize this (p)review, I introduce a conceptual model “beyond supply and demand,” which distinguishes three major subsets of stakeholders of global private regulation, which may (but need not) overlap: the political actors who call for private regulation, the rule-makers who provide such governance for the global economy, and what I call the “targets” of the private regulations, who are supposed to behave according to these private rules. I then highlight the three core questions addressed by the contributions to the special issue: (1) How do private bodies attain regulatory authority; why do private regulators provide governance; and why do the targets of the rules comply? (2) Who governs the global economy through private regulations? And (3) what are the effects of private regulation, and how does the rise of private regulation affect public regulatory authority and capacity?