When the claim hits: bilateral investment treaties and bounded rational learning
Using the international investment regime as its point of departure, the paper applies notions of bounded rationality to the study of economic diplomacy. Through a multi-method approach, it shows that developing countries often ignored the risks of bilateral investment treaties (BITs) until they themselves became subject to an investment treaty claim. Thus the behavior of developing country governments with regard to the international investment regime is consistent with that consistently observed for individuals in experiments and field studies: they tend to ignore high-impact, low-probability risks if they cannot bring specific ‘vivid’ instances to mind.
|Date of creation:||Apr 2013|
|Publication status:||Published in World Politics, April, 2013, 65(2), pp. 273-313. ISSN: 0043-8871|
|Contact details of provider:|| Postal: LSE Library Portugal Street London, WC2A 2HD, U.K.|
Phone: +44 (020) 7405 7686
Web page: http://www.lse.ac.uk/
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.:
- McClelland, Gary H & Schulze, William D & Coursey, Don L, 1993. "Insurance for Low-Probability Hazards: A Bimodal Response to Unlikely Events," Journal of Risk and Uncertainty, Springer, vol. 7(1), pages 95-116, August.
- David Lake, 2009. "Open economy politics: A critical review," The Review of International Organizations, Springer, vol. 4(3), pages 219-244, September.
- Aisbett, Emma, 2007.
"Bilateral Investment Treaties and Foreign Direct Investment: Correlation versus Causation,"
Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series
qt72m4m1r0, Department of Agricultural & Resource Economics, UC Berkeley.
- Aisbett, Emma, 2007. "Bilateral Investment Treaties and Foreign Direct Investment: Correlation versus Causation," MPRA Paper 2255, University Library of Munich, Germany.
- van Harten, Gus, 2007. "Investment Treaty Arbitration and Public Law," OUP Catalogue, Oxford University Press, number 9780199217892.
- Busch, Marc L. & Reinhardt, Eric & Shaffer, Gregory, 2009. "Does legal capacity matter? A survey of WTO Members," World Trade Review, Cambridge University Press, vol. 8(04), pages 559-577, October.
- Bergstrand, Jeffrey H. & Egger, Peter, 2013.
"What determines BITs?,"
Journal of International Economics,
Elsevier, vol. 90(1), pages 107-122.
- John Conlisk, 1996. "Why Bounded Rationality?," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 669-700, June.
- Colin F. Camerer & Howard Kunreuther, 1989. "Decision processes for low probability events: Policy implications," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 8(4), pages 565-592.
- Srividya Jandhyala & Witold J. Henisz & Edward D. Mansfield, 2011. "Three Waves of BITs," Journal of Conflict Resolution, Peace Science Society (International), vol. 55(6), pages 1047-1073, December.
- Arellano, Manuel & Honore, Bo, 2001.
"Panel data models: some recent developments,"
Handbook of Econometrics,
in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 53, pages 3229-3296
- Levy, Jack S., 1994. "Learning and foreign policy: sweeping a conceptual minefield," International Organization, Cambridge University Press, vol. 48(02), pages 279-312, March.
- Mark Tuil & Louis Visscher, 2010. "Introduction," Chapters, in: New Trends in Financing Civil Litigation in Europe, chapter 1 Edward Elgar Publishing.
- Bubb, Ryan J. & Rose-Ackerman, Susan, 2007. "BITs and bargains: Strategic aspects of bilateral and multilateral regulation of foreign investment," International Review of Law and Economics, Elsevier, vol. 27(3), pages 291-311, September.
- Hausman, Jerry & Hall, Bronwyn H & Griliches, Zvi, 1984.
"Econometric Models for Count Data with an Application to the Patents-R&D Relationship,"
Econometric Society, vol. 52(4), pages 909-938, July.
- Jerry A. Hausman & Bronwyn H. Hall & Zvi Griliches, 1984. "Econometric Models for Count Data with an Application to the Patents-R&D Relationship," NBER Technical Working Papers 0017, National Bureau of Economic Research, Inc.
- N. Lesca, 2010. "Introduction," Post-Print halshs-00640602, HAL.
- Simmons, Beth A. & Dobbin, Frank & Garrett, Geoffrey, 2006. "Introduction: The International Diffusion of Liberalism," International Organization, Cambridge University Press, vol. 60(04), pages 781-810, October.
When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:45035. 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: (LSERO Manager)
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.