This book presents a systematic reassessment of the theoretical and empirical foundations of the democratic peace literature. Three distinct theoretical models of how domestic political institutions shape the foreign policy choices of state leaders are developed and Huth and Allee then test hypotheses from each model against an original data set of 348 territorial disputes from 1919–95. Each territorial dispute is divided into three separate but related phases for empirical analysis: Challenge the Status Quo Stage, Negotiation Stage and Military Escalation Stage. Their statistical results provide strong support for the importance of democratic accountability and norms in shaping decisions to negotiate and settle disputes as well as to threaten force and escalate to war. The findings of this book address central debates and provide many insights into understanding when and why democratic leaders engage in cooperative or confrontational foreign policies.

W e develop and test a general argument about the conditions under which state leaders are most likely to choose legal dispute resolution over bilateral negotiations as a means to settle international disputes. Our central claim is that leaders who anticipate significant domestic audience costs for the making of voluntary, negotiated concessions are likely to seek the "political cover" of an international legal ruling. In such cases, it will be easier for leaders to justify the making of concessions if they are mandated as part of a ruling by an international court or arbitration body. We test a series of domestic-level hypotheses using a dataset comprised of nearly 1,500 rounds of talks concerning disputed territorial claims. Our multivariate analyses indicate that state leaders opt for legal dispute resolution when they are highly accountable to domestic political opposition, as well as when the dispute is highly salient to domestic audiences.

During the past few decades governments have signed nearly 2,700 bilateral investment treaties (BITs) with one another in an attempt to attract greater levels of foreign direct investment (FDI). By signing BITs, which contain strong enforcement provisions, investment-seeking governments are thought to more credibly commit to protecting whatever FDI they receive, which in turn should lead to increased confidence among investors and ultimately greater FDI inflows. Our unique argument is that the ability of BITs to increase FDI is contingent on the subsequent good behavior of the governments who sign them. BITs should increase FDI only if governments actually follow through on their BIT commitments; that is, if they comply with the treaties. BITs allow investors to pursue alleged treaty violations through arbitration venues like the International Centre for the Settlement of Investment Disputes (ICSID), a heavily utilized and widely observed arbitral institution that is part of the World Bank. Being taken before ICSID, then, conveys negative information about a host country's behavior to the broader investment community, which could result in a sizeable loss of future FDI into that country. We test these contingent effects of BITs using cross-sectional, time-series analyses on all non-OECD countries during a period spanning 1984–2007. We find that BITs do increase FDI into countries that sign them, but only if those countries are not subsequently challenged before ICSID. On the other hand, governments suffer notable losses of FDI when they are taken before ICSID and suffer even greater losses when they lose an ICSID dispute.

Bilateral investment treaties (BITs) have become the dominant source of rules on foreign direct investment (FDI), yet these treaties vary significantly in at least one important respect: whether they allow investment disputes to be settled through the International Centre for the Settlement of Investment Disputes (ICSID). Through the compilation and careful coding of the text of nearly 1,500 treaties, we identify systematic variation in “legal delegation” to ICSID across BITs and explain this important variation by drawing upon a bargaining framework. Home governments prefer and typically obtain ICSID clauses in their BITs, particularly when internal forces push strongly for such provisions and when they have significantly greater bargaining power than the other signatory. Yet some home governments are less likely to insist upon ICSID clauses if they have historical or military ties with the other government. On the other hand, although host governments are often hostile toward ICSID clauses, particularly when sovereignty costs are high, they are more likely to consent to such clauses when they are heavily constrained by their dependence on the global economy. Our findings have significant implications for those interested in FDI, legalization, international institutions, and interstate bargaining.

A political accountability model is developed to explain how the accountability of incumbent democratic leaders to domestic political opposition influences the diplomatic and military policies of governments. The model is situated within the democratic peace literature and compared with existing theoretical work. Empirically, the hypotheses are tested on a new data set of 348 territorial disputes for the period from 1919 to 1995. Each dispute is divided into three separate stages so that hypotheses about the initiation and outcome of both negotiations and military confrontations, and opposing patterns of war and dispute settlement, can be tested. Results provide strong support for a number of hypotheses concerning the importance of electoral cycles and the strength of opposition parties in explaining patterns of both conflictual and cooperative behavior by democratic states. Anextensiveliteratureontherelationshipbetweendemocracyandinternationalcon-flict has developed over the past decade. 1 Nevertheless, several basic questions and puzzles remain about the existence of, and explanation for, a democratic peace. In this study, we present two main arguments. First, the theoretical literature on the democratic peace is underdeveloped with respect to explaining differences in the conflict behavior of democratic states. We present a series of hypotheses that relate variation in the political accountability of democratic leaders to differences in foreign policy behavior. Second, the prevailing quantitative approach to testing hypotheses about the democratic peace based on dyad-years as the units of observation suffers from several limitations. We propose an alternative research design that focuses on the multiple 754 AUTHORS'NOTE: We thank the National Science Foundation and the U.S. Institute of Peace for financial support of our research. The comments and suggestions of Curt Signorino are especially appreciated.