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Foreign direct investment and labour rights: a panel analysis of bilateral FDI flows

  • Matthias Busse
  • Peter Nunnenkamp
  • Mariana Spatareanu

The article analyses the impact of fundamental labour rights on bilateral Foreign Direct Investment (FDI) flows to 82 developing countries. The results indicate that investments by multinationals are significantly higher in countries that adhere to labour rights, thereby refuting the hypothesis that repression of these rights fosters FDI.

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Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

Volume (Year): 18 (2011)
Issue (Month): 2 ()
Pages: 149-152

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Handle: RePEc:taf:apeclt:v:18:y:2011:i:2:p:149-152
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  1. Javorcik, Beata & Spatareanu, Mariana, 2005. "Do Foreign Investors Care About Labour Market Regulations?," CEPR Discussion Papers 4839, C.E.P.R. Discussion Papers.
  2. Blundell, R. & Bond, S., 1995. "Initial Conditions and Moment Restrictions in Dynamic Panel Data Models," Economics Papers 104, Economics Group, Nuffield College, University of Oxford.
  3. Haaland, Jan I. & Wooton, Ian, 2001. "Multinational Firms: Easy Come, Easy Go?," CEPR Discussion Papers 2660, C.E.P.R. Discussion Papers.
  4. Neumayer, Eric & Soysa, Indra de, 2006. "Globalization and the Right to Free Association and Collective Bargaining: An Empirical Analysis," World Development, Elsevier, vol. 34(1), pages 31-49, January.
  5. Leahy, D. & Montagna, C., 1999. "Unionisation and Foreign Direct Investment: Challenging Conventional Wisdom?," Papers 99/15, College Dublin, Department of Political Economy-.
  6. Philipp Harms & Heinrich W. Ursprung, 2002. "Do Civil and Political Repression Really Boost Foreign Direct Investments?," Economic Inquiry, Western Economic Association International, vol. 40(4), pages 651-663, October.
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