Home About us Contact
|
Home About us Contact | ||
|
|
||
Legal Mechanisms (legal + mechanism)
Selected AbstractsSelf-Interest, Foreign Need, and Good Governance: Are Bilateral Investment Treaty Programs Similar to Aid Allocation?FOREIGN POLICY ANALYSIS, Issue 3 2006ERIC NEUMAYER Bilateral investment treaties (BITs) have become the most important legal mechanism for the encouragement and governance of foreign direct investment (FDI) in developing countries. Yet practically no systematic evidence exists on what motivates capital-exporting developed countries to sign BITs earlier with some developing countries than with others, if at all. The theoretical framework from the aid allocation literature suggests that developed countries pursue a mixture of self-interest, foreign need and, possibly, good governance. We find evidence that both economic interests of developed countries' foreign investors and political interests of developed countries determine their scheduling of BITs. However, foreign need as measured by per capita income is also a factor, whereas good governance by and large does not matter. These results suggest that BIT programs can be explained using the same framework successfully applied to the allocation of aid. At the same time, self-interest seems to be substantively more important than developing country need when it comes to BITs. [source] The Strategic Substitution of United States Foreign AidFOREIGN POLICY ANALYSIS, Issue 2 2010Christopher J. Fariss I present a foreign policy decision-making theory that accounts for why US food aid is used strategically when other more powerful economic aid tools are at the disposal of policymakers. I focus my analysis on US food aid because this aid program provides an excellent case with which to test for the existence of foreign policy substitution. Substitution is an important assumption of many foreign policy theories yet proves to be an allusive empirical phenomenon to observe. Central to this analysis is the identification of legal mechanisms such as the ,,needy people" provision in the US foreign aid legislation that legally restrict certain types of aid; this mechanism, however, does allow for the allocation of certain types of foreign aid, such as food aid, to human rights abusing regimes. Thus, I test if food aid is used as a substitute for human rights abusing states while methodologically accounting for other aid options. The empirical results, estimated with a multinomial logit and Heckman model, demonstrate that countries with high levels of human rights abuse are (i) more likely to receive food aid and (ii) receive greater amounts of food aid even when controlling for other economic aid, the conditioning effect of strategic interests and humanitarian need over the period 1990,2004. [source] The Implications of Trade Credit for Bank Monitoring: Suggestive Evidence from JapanJOURNAL OF ECONOMICS & MANAGEMENT STRATEGY, Issue 2 2008Yoshiro Miwa Firms in modern developed economies borrow from both banks and trade partners. Using Japanese manufacturing data from the 1960s, we estimate the price of trade credit, and explore some of the ways firms choose between the credit and bank loans. We find that firms of all sizes borrow heavily from their trade partners, and at implicit rates that track the explicit rates banks would charge. They borrow from banks when they anticipate needing money for relatively long periods; they turn to trade partners when they face short-term unexpected exigencies. This apparent contrast in the term structures follows, we suggest, from the fundamentally different way bankers and trade partners cut default risk. Because bankers seldom know their borrowers' industries first hand, they rely on formal legal protection (like security interests). Because trade partners know the industry well, they reduce risk by monitoring their borrowers closely instead. Because the costs to creating legal mechanisms are heavily front-loaded, bankers focus on long-term debt; because the costs of monitoring debtors are ongoing, trade creditors do not. Apparently, banks monitor less than we have thought. [source] Intellectual Property Rights and Foreign Investment: The Political Economy of Taiwan's Technology-Intensive Foreign Direct InvestmentASIAN POLITICS AND POLICY, Issue 4 2009Douglas B. Fuller This article employs Taiwan's institutions for intellectual property rights (IPR) to explain two aspects of Taiwan's foreign direct investment behavior: the location of offshore sites for Taiwanese research and development, and investment by Taiwanese venture capitalists. The article first describes the evolution of Taiwan's informal IPR practices that differ from the ideal typical IPR regime supposedly required for economies as technologically sophisticated as Taiwan's. Essentially, Taiwan has developed informal practices to protect corporate IPR that are centered on internal corporate mechanisms rather than external formal legal mechanisms. Relying on these informal practices, the article discusses how Taiwan has invested in technology-intensive activities in locations where IPR protection is weak. This behavior stands in sharp contrast to the behavior of multinationals from the Organisation for Economic Co-operation and Development countries. [source] | ||||||||||