Academic
Publications
Do bilateral investment treaties increase foreign direct investment to developing countries?

Do bilateral investment treaties increase foreign direct investment to developing countries?,10.1016/j.worlddev.2005.07.001,World Development,Eric Neu

Do bilateral investment treaties increase foreign direct investment to developing countries?   (Citations: 72)
BibTex | RIS | RefWorks Download
Summary. — Foreign investors are often skeptical toward the quality of the domestic institutions and the enforceability of the law in developing countries. Bilateral investment treaties (BITs) guar- antee certain standards of treatment that can be enforced via binding investor-to-state dispute set- tlement outside the domestic juridical system. Developing countries accept restrictions on their sovereignty in the hope that the protection from political and other risks leads to an increase in foreign direct investment (FDI), which is also the stated purpose of BITs. We provide the first rig- orous quantitative evidence that a higher number of BITs raises the FDI that flows to a developing country. This result is very robust to changes in model specification, estimation technique, and sam- ple size. There is also some limited evidence that BITs might function as substitutes for good domestic institutional quality, but this result is not robust to different specifications of institutional quality. 2005 Elsevier Ltd. All rights reserved.
Journal: World Development - WORLD DEVELOP , vol. 33, no. 10, pp. 1567-1585, 2005
Cumulative Annual
View Publication
The following links allow you to view full publications. These links are maintained by other sources not affiliated with Microsoft Academic Search.
    • ...Among those that have (Neumayer and de Soysa 2005; Kucera 2002), the emphasis has been on FDI writ large and the results have been inconclusive...

    Robert G. Blantonet al. Labor Rights and Foreign Direct Investment: Is There a Race to the Bot...

    • ...Neumayer and Spess (2005) find strong correlations between BITs and FDI flows...
    • ...Neumayer and Spess (2005) and Hallward-Driemeier (2003)...
    • ...Further, to maintain similarity with the existing BITs literature we base our model on the specification in Neumayer and Spess (2005)...

    Jennifer L. Tobinet al. When BITs have some bite: The political-economic environment for bilat...

    • ...discussed at all, unilateral measures are discounted as non-binding (Neumayer and Spess 2005)...
    • ...Neumayer and Spess (2005) suspect that the dyadic approach of Hallward-...
    • ...For instance, Neumayer and Spess (2005) cover a broader sample than Tobin and Rose-Ackerman (2005)...
    • ...Neumayer and Spess (2005, p. 1573) argue that it is mainly BITs concluded between a developed and a developing (or transition) country that can be expected to have significant effects on FDI flows from the former to the latter...
    • ...Hallward-Driemeier (2003), Neumayer and Spess (2005) and Tobin and Rose-Ackerman (2005, 2006), we follow them in using FDI flows as our dependent variable...
    • ...FDI flows. We overcome the critique of Neumayer and Spess (2005) concerning the limited host country coverage of previous dyadic analyses by fully exploiting the (largely unpublished) data on bilateral FDI flows available upon request from UNCTAD’s Data Extract Service...
    • ...Neumayer and Spess (2005) lag BITs by one period to mitigate potential reverse causality, but dismiss instrumental...
    • ...be problematic, however, especially when using annual data as in Neumayer and Spess (2005)...
    • ...This instrumentation is awkward if Neumayer and Spess (2005) are right in that BITs concluded with a particular source country have signaling effects and may, thus, be correlated with FDI from other sources, too...
    • ...In fact, our model fit is quite similar to those obtained by Hallward-Driemeier (2003) and Neumayer and Spess (2005)...
    • ...Concerning institutional quality, our finding corroborates the results reported by Neumayer and Spess (2005), 37 rather...
    • ...37 Neumayer and Spess (2005) use several indicators for institutional quality and also find that the...

    Matthias Busseet al. FDI promotion through bilateral investment treaties: more than a bit?

    • ...Some find that BITs foster FDI inflows (Büthe and Milner, 2008, 2009; Egger and Pfaffermayr, 2004; Kerner, 2009; Neumayer and Spess, 2005; Salacuse and Sullivan, 2005), but others find either a very limited or a highly conditional effect (Aisbett, 2007; Gallagher and Birch, 2006; Hallward-Driemeier, 2003; Tobin and Rose-Ackerman, 2006; UNCTAD, 1998; Yackee, 2008a)...

    Yoram Z. Haftel. Ratification counts: US investment treaties and FDI flows into develop...

    • ...Scores range from 0, which indicates the executive has political discretion and could change existing policies at any point in time, to 1, which indicates that a change of existing policies is totally infeasible (Neumayer and Spees, 2005...

    Mehmet Demirbaget al. Institutional and transaction cost determinants of Turkish MNEs' locat...

Sort by: