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The Political Influence of Foreign Firms in Developing Countries

Author

Listed:
  • Rodolphe Desbordes
  • Julien Vauday

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

Abstract

Foreign firms are likely to attempt to shape host government policies in their favour, as the profitability of MNE foreign affiliates largely depends on the business environment in which they operate. Based on data from the World Business Environment Survey, this paper investigates the political influence of foreign firms in 48 developing countries. It is found that foreign firms derive substantial fiscal and regulatory advantages from their political influence and from their ability to negotiate superior entry conditions.

Suggested Citation

  • Rodolphe Desbordes & Julien Vauday, 2007. "The Political Influence of Foreign Firms in Developing Countries," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00363192, HAL.
    • Handle: RePEc:hal:cesptp:hal-00363192
    DOI: 10.1111/j.1468-0343.2007.00317.x
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    References listed on IDEAS

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