Price or politics? An investigation of the causes of expropriation
Expropriations of foreign direct investment in developing countries are typically blamed on political and economic crises in those countries. Developing a new database of expropriations in the minerals sectors of developing country exporters, I show that expropriations were correlated with mineral price booms and that democratic governments were more likely to expropriate. No link is found between expropriations and political or economic crises, except at independence. A better explanation of expropriation would be opportunistic behaviour by host governments when profits of investments are high. In two developed countries, Australia and Canada, expropriations are also found to occur during price booms.
Volume (Year): 50 (2006)
Issue (Month): 1 (March)
|Contact details of provider:|| Postal: |
Phone: 0409 032 338
Web page: http://www.aares.info
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Picht, Hartmut & Stuven, Volker, 1991. " Expropriation of Foreign Direct Investments: Empirical Evidence and Implications for the Debt Crisis," Public Choice, Springer, vol. 69(1), pages 19-38, February.
- Atkeson, Andrew, 1991.
"International Lending with Moral Hazard and Risk of Repudiation,"
Econometric Society, vol. 59(4), pages 1069-89, July.
- Andrew Atkeson, 2010. "International lending with moral hazard and risk of repudiation," Levine's Working Paper Archive 200, David K. Levine.
- Raff, H, 1991.
"A Model of Expropriation with Asymetric Information,"
Cahiers de recherche
9105, Université Laval - Département d'économique.
- Raff, Horst, 1992. "A model of expropriation with asymmetric information," Journal of International Economics, Elsevier, vol. 33(3-4), pages 245-265, November.
- Schnitzer, Monika, 1998.
"Expropriation and Control Rights: A Dynamic Model of Foreign Direct Investment,"
CEPR Discussion Papers
1891, C.E.P.R. Discussion Papers.
- Schnitzer, Monika, 1999. "Expropriation and control rights: A dynamic model of foreign direct investment," International Journal of Industrial Organization, Elsevier, vol. 17(8), pages 1113-1137, November.
- Schnitzer, Monika, 1999. "Expropriation and control rights: A dynamic model of foreign direct investment," Munich Reprints in Economics 19890, University of Munich, Department of Economics.
- Thomas, J. & Worral, T., 1991.
"Foreign Direcyt Investment and the Risk of Expropriation,"
9126, Tilburg - Center for Economic Research.
- Thomas, Jonathan & Worrall, Tim, 1994. "Foreign Direct Investment and the Risk of Expropriation," Review of Economic Studies, Wiley Blackwell, vol. 61(1), pages 81-108, January.
- Thomas, J.P. & Worrall, T., 1991. "Foreign direct investment and the risk of expropriation," Discussion Paper 1991-26, Tilburg University, Center for Economic Research.
- Thomas, J. & Worrall, T., 1990. "Foreign Direct Investment And The Risk Of Expropriation," The Warwick Economics Research Paper Series (TWERPS) 342, University of Warwick, Department of Economics.
- Thomas, Jonathan & Worrall, Tim, 1990. "Foreign direct investment and the risk of expropriation," Kiel Working Papers 411, Kiel Institute for the World Economy.
- Cole, Harold L. & English, William B., 1991. "Expropriation and direct investment," Journal of International Economics, Elsevier, vol. 30(3-4), pages 201-227, May.
- Robert T. Deacon & Henning Bohn, 2000.
"Ownership Risk, Investment, and the Use of Natural Resources,"
American Economic Review,
American Economic Association, vol. 90(3), pages 526-549, June.
- Bohn, Henning & Deacon, Robert, 1997. "Ownership Risk, Investment, and the Use of Natural Resources," Discussion Papers dp-97-20, Resources For the Future.
- Harald Knudsen, 1974. "Explaining the National Propensity to Expropriate: An Ecological Approach," Journal of International Business Studies, Palgrave Macmillan, vol. 5(1), pages 51-71, March.
- Eaton, Jonathan & Gersovitz, Mark, 1984.
"A Theory of Expropriation and Deviations from Perfect Capital Mobility,"
Royal Economic Society, vol. 94(373), pages 16-40, March.
- Jonathan Eaton & Mark Gersovitz, 1982. "A Theory of Expropriation and Deviations From Perfect Capital Mobility," NBER Working Papers 0972, National Bureau of Economic Research, Inc.
- Randall J Jones, 1984. "Empirical Models of Political Risks in U.S. Oil Production Operations in Venezuela," Journal of International Business Studies, Palgrave Macmillan, vol. 15(1), pages 81-95, March.
- Veugelers, Reinhilde, 1993. "Reputation as a Mechanism Alleviating Opportunistic Host Government Behavior against MNEs," Journal of Industrial Economics, Wiley Blackwell, vol. 41(1), pages 1-17, March.
- Garnaut, Ross & Clunies Ross, Anthony, 1975. "Uncertainty, Risk Aversion and the Taxing of Natural Resource Projects," Economic Journal, Royal Economic Society, vol. 85(338), pages 272-87, June.
- Stephen J Kobrin, 1979. "Political Risk: A Review and Reconsideration," Journal of International Business Studies, Palgrave Macmillan, vol. 10(1), pages 67-80, March.
When requesting a correction, please mention this item's handle: RePEc:ags:aareaj:116859. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.