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Foreign Direct Investment, Regime Type, and Labor Protest in Developing Countries

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  • Graeme B. Robertson
  • Emmanuel Teitelbaum

Abstract

We explore the relationship between FDI, regime type, and strikes in low‐ and middle‐income countries. We argue that FDI produces social tensions and opportunities for protest that can result in higher levels of industrial conflict. However, the effect of FDI is moderated by regime type. While democracies tend to have higher levels of protest overall, they are better able than authoritarian regimes to cope with the strains arising from FDI. We cite two reasons. First, political competition forces regimes to incorporate workers, which shifts conflict from industrial relations to the political arena. Second, democracies provide workers with freedom of association rights, which facilitate institutionalized grievance resolution. We test the argument using a new dataset of labor protest in low‐ and middle‐income countries for the period 1980–2005.

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  • Graeme B. Robertson & Emmanuel Teitelbaum, 2011. "Foreign Direct Investment, Regime Type, and Labor Protest in Developing Countries," American Journal of Political Science, John Wiley & Sons, vol. 55(3), pages 665-677, July.
    • Handle: RePEc:wly:amposc:v:55:y:2011:i:3:p:665-677
    DOI: 10.1111/j.1540-5907.2011.00510.x
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    Cited by:

    1. Jirjahn, Uwe, 2024. "Corporate Globalization and Worker Representation," IZA Discussion Papers 16727, Institute of Labor Economics (IZA).
    2. Cooray, Arusha & Tamazian, Artur & Vadlamannati, Krishna Chaitanya, 2014. "What drives FDI policy liberalization? An empirical investigation," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 179-189.
    3. Wen‐Chin Wu & Fangjin Ye, 2020. "Preferential Trade Agreements, Democracy, and the Risk of Coups d’état," Social Science Quarterly, Southwestern Social Science Association, vol. 101(5), pages 1834-1849, September.
    4. Samuel Brazys & Krishna Chaitanya Vadlamannati & Indra de Soysa, 2019. "Oil Price Volatility and Political Unrest: Prudence and Protest in Producer and Consumer Societies, 1980-2013," Working Papers 201908 Key words: Oil wea, Geary Institute, University College Dublin.
    5. Fangjin Ye, 2020. "The impact of bilateral investment treaties (BITs) on collective labor rights in developing countries," The Review of International Organizations, Springer, vol. 15(4), pages 899-921, October.
    6. Vadlamannati, Krishna Chaitanya & Janz, Nicole & Berntsen, Øyvind Isachsen, 2018. "Human Rights Shaming and FDI: Effects of the UN Human Rights Commission and Council," World Development, Elsevier, vol. 104(C), pages 222-237.
    7. Wu, Yan & Heerink, Nico, 2016. "Foreign direct investment, fiscal decentralization and land conflicts in China," China Economic Review, Elsevier, vol. 38(C), pages 92-107.
    8. Süveyda Karakaya, 2018. "Globalization and contentious politics: A comparative analysis of nonviolent and violent campaigns," Conflict Management and Peace Science, Peace Science Society (International), vol. 35(4), pages 315-335, July.

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