Property Rights Regimes, Technological Innovation, and Foreign Direct Investment

Nieman, Mark David; Thies, Cameron G.

doi:10.1017/psrm.2017.46

Cited by 10 publications

(5 citation statements)

References 59 publications

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“…Regardless of the specific mechanism, studies agree that democracies offer a more stable institutional environment and greater predictability, which reduce investors’ risk perceptions. 8 Other characteristics that affect political risk include governments’ human rights records, the rule of law, property rights and regulatory quality (Daude and Stein, 2007; Blanton and Blanton, 2007, 2009; Staats and Biglaiser, 2012; Barry et al, 2013; Nieman and Thies, 2019).…”

Section: Political Risk and Fdimentioning

confidence: 99%

The effect of economic coercion on companies’ foreign direct investment decisions: Evidence from sanctions against Russia

McLean,

Ryu,

Whang

2023

Conflict Management and Peace Science

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Existing research on the relationship between economic coercion and foreign direct investment suggests that sanctions have no effect on investments in targeted countries or may even encourage investment inflows. A key limitation of this research, however, is its aggregate country-level focus, which fails to capture company-level decision-making processes and factors shaping them. In contrast, this paper evaluates multinational companies’ investment plans as reflected in new investment announcements and shows that sanctions in fact lead to significant adjustments in multinational companies’ plans to invest in a targeted country. Our company-level analyses of new investment projects in Russia show that companies are less likely to announce new investments after the imposition of economic sanctions against the country.

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Section: Political Risk and Fdimentioning

confidence: 99%

The effect of economic coercion on companies’ foreign direct investment decisions: Evidence from sanctions against Russia

McLean,

Ryu,

Whang

2023

Conflict Management and Peace Science

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“…Among those who have examined whether politically constrained regimes are in fact better able to commit not to expropriate foreign direct investment, many have found support. For example, a number of scholars have identified a positive relationship between the property rights protections afforded under democratic-type legal institutions and FDI inflows (see, e.g., Jensen, 2003; Li, 2009; Li & Resnick, 2003; Nieman & Thies, 2018; Staats & Biglaiser, 2012). In addition, several studies have shown a direct link between expropriation risk and institutional constraints.…”

Section: The Propensity To Expropriatementioning

confidence: 99%

Covert Confiscation: How Governments Differ in Their Strategies of Expropriation

Esberg

Perlman

2022

Comparative Political Studies

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A substantial literature concludes that democratic-type institutions curb governments’ propensity to expropriate foreign direct investment. However, little attention has been paid to the strategies of expropriation regimes employ. We theorize that more politically constrained regimes will utilize expropriation methods that help them overcome institutional impediments. Using data on expropriations in developing countries between 1960 and 2014, we show that rather than rely on the most direct and overt forms of expropriation, constrained regimes tend to use more indirect and covert methods, such as forced sale or contract renegotiation, tools which can be harder to identify, easier to justify, and frequently face lower legislative approval hurdles. Indeed, while more politically constrained regimes are less likely to overtly expropriate foreign investment than less constrained regimes, they are nearly as likely to do so covertly, introducing new questions about the extent to which institutional constraints really translate into improved protections for foreign investors.

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“…Nieman and Thies (2019) examined the property rights-FDI nexus in developed and developing nations. The influence of property rights on FDI was found to have been more pronounced in developing and developed countries characterized by quite strong democratic institutions Maskus (2000).…”

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confidence: 99%

Impact of intellectual property rights on foreign direct investment in Africa

Tsaurai

2024

Investment Management and Financial Innovations

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The study investigated the impact of intellectual property rights on foreign direct investment (FDI) in selected African countries (Burkina Faso, Ivory Coast, Nigeria, Cameroon, Mali, Kenya, Burundi, Central African Republic, Rwanda, Senegal, Zimbabwe, and Tanzania). The purpose of the study is to develop property rights policies that encourages FDI in African countries. How FDI is influenced by the combination of trade openness and intellectual property rights was also examined using the same data set and econometric methods such as the dynamic generalized method of moments (GMM), fixed effects, and pooled ordinary least squares (OLS). Panel data ranging from 2005 to 2019 were used for the purposes of this study. A 1% increase in intellectual property rights led to a 22.73% increase in FDI inflows under the dynamic GMM and a 45.55% increase in FDI inflows under the random effects. These results show that intellectual property rights significantly enhanced FDI under the random effects and dynamic GMM. FDI was insignificantly enhanced by intellectual property rights under the pooled OLS and fixed effects methods. A 1% increase in complementarity between intellectual property rights and trade openness (complementarity term) pushed up FDI inflows by 17.78% under the dynamic GMM, whilst a 1% increase in the complementarity term increased FDI inflows by 16.72% under the fixed effects. In other words, dynamic GMM and fixed effects approaches show that the complementarity component significantly improved FDI inflows. The paper recommends implementing the best property rights strategies to improve FDI inflows into African countries. AcknowledgmentThe author appreciates the moral support from the University of South Africa, his employer.

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Property Rights Regimes, Technological Innovation, and Foreign Direct Investment

Cited by 10 publications

References 59 publications

The effect of economic coercion on companies’ foreign direct investment decisions: Evidence from sanctions against Russia

The effect of economic coercion on companies’ foreign direct investment decisions: Evidence from sanctions against Russia

Covert Confiscation: How Governments Differ in Their Strategies of Expropriation

Impact of intellectual property rights on foreign direct investment in Africa

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