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Foreign Direct Investment and Civil Rights: Testing Decreasing Returns to Civil Rights

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  • Ponce, Aldo

Abstract

In this paper, I examine the effectiveness of improvements in political and civil rights for attracting foreign direct investment flows (FDI) into democracies. I contend that advances in the quality of democracy – specifically those concerning civil rights – present positive but decreasing marginal returns in attracting FDI inflows. I empirically prove this proposition by using panel data regressions within the Latin American and Eastern European contexts from periods following their democratization (1991-2003).

Suggested Citation

  • Ponce, Aldo, 2010. "Foreign Direct Investment and Civil Rights: Testing Decreasing Returns to Civil Rights," MPRA Paper 22020, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:22020
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    More about this item

    Keywords

    foreign direct investment; civil rights; democratization; developing nations; Latin America; Eastern Europe;
    All these keywords.

    JEL classification:

    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • P52 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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