Constructing investor rights? Why some states (fail to) terminate bilateral investment treaties

Calvert, Julia

doi:10.1080/09692290.2017.1406391

Cited by 13 publications

(7 citation statements)

References 43 publications

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“…Moreover, existing studies have addressed the determinants of BIT ratification (Bergstrand & Egger, 2013) and renegotiation (Haftel & Thompson, 2018), but they have not yet addressed the economic consequences of BIT terminations. We found several studies by legal scholars (Calvert, 2018;Carska-Sheppard, 2009;Lavopa et al, 2013) but are, to the best of our knowledge, not aware of any economics research on BIT termination.…”

Section: Introductionmentioning

confidence: 92%

The impact of unilateral BIT terminations on FDI: Quasi-experimental evidence from India

Hartmann

Spruk

2022

Rev Int Organ

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This study identifies the impact of Bilateral Investment Treaties (BITs) on foreign direct investments (FDI) by taking advantage of the random timing of 44 unilateral BIT terminations in India between 2013 and 2019. Using quarterly bilateral data of 138 foreign investors’ home countries (FIHCs), our difference-in-differences (DD) estimates uncover a significant reduction in FDI inflows to India in response to BIT terminations by more than 30 percent compared to countries without terminations. We identify the sudden break with investor protection for new investments as the major transmission channel. Further investigations suggest that investors do not necessarily abandon India in response to BIT terminations but apparently reroute FDI via FIHCs with BITs. Evidence from firm-level data reveals that investors revoke or reroute mainly deals (e.g. mergers and acquisitions) rather than own new projects. Moreover, similarity of some legal institutions with India offsets the negative effect of BIT terminations.

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Section: Introductionmentioning

confidence: 92%

The impact of unilateral BIT terminations on FDI: Quasi-experimental evidence from India

Hartmann

Spruk

2022

Rev Int Organ

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“…Why has the international investment regime taken on this unexpected turn? Part of the answer surely stems from the fact that firms have learned more about how these treaties work, and how broad and imprecise they actually are (Tucker 2018;Calvert 2018). But this does not help explain where this newfound understanding came from or why a new set of actors can effectively profit off the regime at the expense of governments.…”

Section: Figurementioning

confidence: 99%

The Financialization of International Law

Kalyanpur¹,

Newman²

2020

Perspect. polit.

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We investigate how the international investment regime turned into an investment vehicle. Through the process called third-party funding, financiers back international legal claims by firms against countries and in turn seek a share of any potential award. More generally, we add to debates on how international regimes evolve and at times generate unanticipated consequences. Building off work on the sociology of fields, we argue that institutional change can occur when individuals from different fields interact. Each field has its own local practices and beliefs about how governance institutions like international regimes function. When professionals from one field analyze problems in another, they use the tools from their native field. If potential solutions provide material and status benefits for the dominant actors in the targeted regime, cross-field coalitions can form and change the targeted regime’s practice. As hedge funds in the finance field and lawyers in the international law field sought to reinvent themselves after the 2008 financial crisis, they teamed up to make Investor State Dispute Settlement a speculator’s game. Theoretically, we embed theories of regime change within larger social relations, highlighting the importance of informal interactions among regime operators for the use and function of governance institutions. We underscore the role of field interdependence as actors engage in contestation across social and political domains. Empirically, we demonstrate the way in which financialization has had far-reaching consequences that extend well beyond traditional economic sectors, reconfiguring the practice of international law.

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“…Recent work (Bunte, 2019;Calvert, 2018) has highlighted the important role that domestic factors can play in influencing policy space. Building on this, I argue that in the realm of financial policy, the increased availability of low-conditionality external financing options opens up only the potential to increase policy space.…”

Section: Economic Globalization and Policy Spacementioning

confidence: 99%

“…Ideational accounts highlight the importance of key policymakers' normative beliefs in determining how they perceive the costs and benefits of violating international agreements for developmental purposes (Calvert, 2018). In finance, a 'neodevelopmentalist' ideational consensus that finance should be subordinated to the needs of the productive economy through centralized state control (Thurbon, 2016, pp.…”

Section: Domestic Explanations For Policy Spacementioning

confidence: 99%

“…47-65), as opposed to policymakers who believe financial liberalization is economically beneficial, should lead governments to diversify into conditionality free financing sources where possible, so that they can implement the domestic policies they favor. While policymakers' ideologies are undoubtedly important, because liberal policymakers would have little interest in interventionist policies, policymakers' orientations are likely to reflect the interests of those who brought them to power (Bunte, 2019;Calvert, 2018). We need to explain why developmentalist policymakers came into power in the first place, and why they were able to actually implement their preferred policies against domestic or external opposition in some periods, but not in others.…”

Section: Domestic Explanations For Policy Spacementioning

confidence: 99%

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Renationalizing finance for development: policy space and public economic control in Bolivia

Naqvi

2019

Review of International Political Economy

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After years of placing faith in the markets, we are seeing a revival of interest in statist economic policy across the world, particularly with regards to finance. How much policy space do previously liberalized developing countries still have to renationalize their financial sectors by exerting direct control over the process of credit allocation, despite the constraints posed by economic globalization? Under what conditions do they actually use this policy space? Bolivia is an especially important case because it is one of the few peripheral countries that implemented strongly interventionist financial reform in the 2010s. Using Bolivia as a least likely case, I argue that two factors, increased availability of external financing sources, and domestic popular mobilization, create favorable conditions for developmentalist financial reform because these make it possible to reduce external conditionalities and overcome opposition by the domestic financial sector. Popular mobilizations paved the way for reform by bringing developmentalist policymakers to power and exerting pressure on them to 1. Maximize policy space by diversifying into newly available alternative sources of foreign borrowing to reduce external conditionalities, and 2. Mitigate the importance of disinvestment threats by domestic economic elites by incrementally increasing public ownership and control of the economy.

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Constructing investor rights? Why some states (fail to) terminate bilateral investment treaties

Abstract: Constructing investor rights? Why some states (fail to) terminate bilateral investment treaties

Cited by 13 publications

References 43 publications

The impact of unilateral BIT terminations on FDI: Quasi-experimental evidence from India

The impact of unilateral BIT terminations on FDI: Quasi-experimental evidence from India

The Financialization of International Law

Renationalizing finance for development: policy space and public economic control in Bolivia

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