Who commits to the rule of law? Constrained government and foreign direct investment in postcommunist states

Touchton, Michael

doi:10.1080/21599165.2015.1088435

Cited by 6 publications

(5 citation statements)

References 80 publications

(63 reference statements)

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“…The rule of law is both a necessary and sufficient condition for peace, confirming the thesis of Bleiker and Krupanski (2008) that state institutions, especially those in charge of justice and security delivery, which promote and adhere to the rule of law, can contribute to sustainable peace. Moreover, Eastern Europe and Eurasia are also confirming Touchton's (2015) assumptions that credible commitment to the rule of law requires much more than constitutional separation of powers or institutional checks and balances. Rule of law must work in parallel with strong state and must be founded on democratic accountability to condition the peace.…”

Section: Discussionmentioning

confidence: 53%

The importance of the political order for peace

Kildi

Cepoi

2017

JACPR

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Purpose The purpose of this paper is to address the issue of security challenges in the selected states in Eurasia and Central and Eastern Europe from the perspective of peace and politics. Since the security situation differs significantly across the sub-regions under scrutiny, the main objective of the current research is to establish and test a theoretical model of relevant combinations of political factors and their relation to peace. The theoretical framework has been designed by following Fukuyama’s idea of political order and upgraded with the newly constructed index of social exclusion. Design/methodology/approach According to the objective and methodological gaps in this field, the paper applies comparative fuzzy set analysis. The method relies on the theoretical framework and empirical data and allows a constant communication between the two. It has allowed the research to focus on what conditions are necessary and/or sufficient for peace in the selected countries. Findings It is evident there are several different paths to achieve peace. However, the rule of law clearly constitutes both the necessary and sufficient conditions for peace in the selected regions. Moreover, the results of the research reveal that the concepts of interest are highly interlinked with each other, especially when it comes to the rule of law, state, and democratic accountability. Thus, further research should focus on in-depth analysis of each particular case to explore which conditions or combinations are decisive in particular setting. Originality/value Such findings can contribute to improving the areas where Eurasian countries are still lagging behind. Further research should focus on small but significant differences within these four groupings of countries, to improve the understanding of prerequisites for peace and contribute to the development of state and human security in the EU neighborhood.

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Section: Discussionmentioning

confidence: 53%

The importance of the political order for peace

Kildi

Cepoi

2017

JACPR

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“…For example, some recent literature emphasizes regime type, such as democracy vs. autocracy (Moon 2019;Hamid et al 2022), regulatory components and business environment (Contractor et al 2020), and specific political institutions, such as term limits, including in authoritarian countries (Wang et al 2020). Infrastructure and regulatory quality in a general sense and political stability are also commonly discussed indicators shown to influence FDI inflows (Paul and Jadhav 2019;Touchton 2015aTouchton , 2015bTouchton , 2016. Gravity models, neighbor country effects, and membership in trading blocs are also frequent ways to estimate and account for variation in FDI (Dorakh 2020).…”

Section: Control Variablesmentioning

confidence: 99%

“…First, I contribute to the debate on assessing the credibility of contract enforcement and property rights by using FDI inflows as the dependent variable in my analysis. Several previous studies evaluating the arguments surrounding constrained government use perceptual measures that depend on expert surveys to evaluate property rights (Keefer and Khemani 2005), corruption (Brown et al 2011), and the rule of law (Andrews and Montinola 2004;Touchton 2015aTouchton , 2015b) cross-nationally. These studies assume connections between perceptions and the frequently unobservable underlying concepts.…”

Section: Introductionmentioning

confidence: 99%

Government Checks and Balances, Policy Credibility, and Foreign Direct Investment: A Cross-National Investigation

Touchton

2023

Economies

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Placing constraints on elected officials is thought to bind their hands and render government policies credible. In turn, credible policies attract investment because investors can extend their policy and regulatory time horizons. Yet, a scholarship on LMICs suggests that too many constraints on policymakers may preclude necessary reforms, which repels capital. I motivate the study with an example from Liberia. Then, I evaluate political constraints and FDI for 182 countries between 1996 and 2022 and demonstrate that the rule of law conditions relationships between constraints on governments and FDI; in places with high rule of law, constraining government attracts FDI. In contrast, high constraints push investment away in contexts where the rule of law is lower. The logic is that constraining government makes credible high-income governments’ previous commitments to property rights and contract enforcement. However, the very same constraints on government may prevent LMICs from making credible commitments in the first place. Constraining government thus prevents desirable reforms under many circumstances, which I illustrate by returning to the Liberia example in the discussion. Ultimately, this study raises questions about universal benefits emerging from policy credibility and extends our understanding of political institutions, credible commitment, and FDI.

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“…Less corrupt transition economies (such as Estonia or the Czech Republic) attract more FDI than more corrupt transition states (such as Azerbaijan or Uzbekistan) (Javorcik and Wei, 2009). Finally, credible government policies and the improved rule of law contribute at most in transforming post-socialist countries of Eastern Europe and Eurasia in FDI's recipient countries (Touchton, 2015).…”

Section: Governancementioning

confidence: 99%

“…The rule of law measures perceptions on the effectiveness and predictability of the judiciary, as well as contracts' enforceability. An improved rule of law act as a stimulus to FDI inflows (Bailey, 2018;Cleeve, 2012;Gani, 2007;Mengistu and Adhikary, 2011;Méon and Sekkat, 2005; Rodríguez-Pose and Cols, 2017; Shah and Afridi, 2015;Staats and Biglaiser, 2012;Touchton, 2015) and is expected to hold a positive sign.…”

Section: (Ii)mentioning

confidence: 99%

The political regime as a determinant of inward foreign direct investment

Τριάρχη¹

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H εν λόγω διατριβή αναλύει το πολιτικό καθεστώς ως καθοριστικό παράγοντα των εισερχομένων Άμεσων Ξένων Επενδύσεων (ΑΞΕ). Πάνω απ’ όλα, εξετάζει τη σημασία του πολιτικού συστήματος μαζί με συγκεκριμένους παράγοντες για την τόνωση των εισροών ΑΞΕ στις Ευρωπαϊκές υπό μετάβαση οικονομίες. Η έρευνα μας επικεντρώνεται σε εκείνες τις χώρες της Βαλκανικής χερσονήσου που δεν είναι μέλη της ΕΕ, συγκεκριμένα στις χώρες των Δυτικών Βαλκανίων της Αλβανίας, της Βοσνίας-Ερζεγοβίνης, του Κοσσυφοπεδίου, της Βόρειας Μακεδονίας, της Σερβίας και του Μαυροβουνίου. Το θεωρητικό πλαίσιο της διατριβής δίδεται από την βιβλιογραφική επισκόπηση. Η βιβλιογραφική επισκόπηση διακρίνει συγκεκριμένους παράγοντες που συμβάλλουν στη θεσμική σταθερότητα και αξιοπιστία των χωρών υποδοχής και ως εκ τούτου, στην αύξηση των εισροών ΑΞΕ. Αυτοί είναι η προστασία των δικαιωμάτων ιδιοκτησίας, η υπογραφή διμερών επενδυτικών συνθηκών, τα ανθρώπινα δικαιώματα και η ποιότητα της διακυβέρνησης, συμπεριλαμβανομένων των έξι διαστάσεων της, ήτοι φωνή και λογοδοσία, πολιτική σταθερότητα και απουσία της βίας / τρομοκρατίας, κυβερνητική αποτελεσματικότητα, κανονιστική ποιότητα, κράτος δικαίου και έλεγχος της διαφθοράς. Η θεωρητική ανάλυση του πολιτικού συστήματος στις χώρες των Δυτικών Βαλκανίων βασίζεται, πέρα από τις εμπειρικές μελέτες, σε επίσημες εκθέσεις διεθνών αναγνωρισμένων οργανισμών και μελέτες πολιτικής σχετικά με το καθεστώς μετάβασης των χωρών. Ο σχεδιασμός του εμπειρικού μοντέλου της έρευνας περιλαμβάνει τις μεταβλητές που σχετίζονται με την προστασία των ξένων επενδυτών και μετρά την ποιότητα της διακυβέρνησης μαζί με τη μεταβλητή του πολιτικού καθεστώτος. Η εμπειρική ανάλυση χρησιμοποιεί panel data analysis των μεταβλητών ενδιαφέροντος για την περίοδο 1996-2018, για το σύνολο των έξι χώρων. Δεδομένου ότι οι ευρωπαϊκές υπό μετάβαση οικονομίες βιώνουν μια νέα πολιτική πραγματικότητα, με την μελέτη των ειδικών καθοριστικών πολιτικών παραγόντων των εισερχομένων ΑΞΕ όπως διαμορφώνονται στο πολιτικό περιβάλλον των συγκεκριμένων χωρών, αναμένεται η εξαγωγή σαφών αποτελεσμάτων. Τα ευρήματα αυτής της διατριβής ρίχνουν περισσότερο φως στη σχέση πολιτικού συστήματος - ΑΞΕ, συμβάλλοντας στην υπάρχουσα βιβλιογραφία και παρέχοντας ένα πλαίσιο για τις οικονομίες μετάβασης να ξεπεράσουν συγκεκριμένα πολιτικά ζητήματα που εμποδίζουν την αύξηση των εισερχόμενων ροών ΑΞΕ και να αναπτυχθούν ως προορισμοί ΑΞΕ.

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Who commits to the rule of law? Constrained government and foreign direct investment in postcommunist states

Cited by 6 publications

References 80 publications

The importance of the political order for peace

The importance of the political order for peace

Government Checks and Balances, Policy Credibility, and Foreign Direct Investment: A Cross-National Investigation

The political regime as a determinant of inward foreign direct investment

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