Democratic Accountability, Regulation and Inward Investment Policy
type="main" xml:id="ecpo12034-abs-0001"> <p>We examine the effect of domestic political accountability on leaders' strategies for attracting foreign direct investment to less developed countries. We consider two policy areas: the tax burden imposed on firms and the regulatory environment in which they operate. We find that democratic governments are more likely to offer relatively lower tax rates to foreign investors, whereas autocratic governments are more likely to offer relatively lax regulation. This result is driven by the greater elasticity of the political survival function to environmental and labor regulations in more democratic countries. Analyses of firm-level survey data confirm our main theoretical conclusions.
Year of publication: |
2014
|
---|---|
Authors: | Dorsch, Michael T. ; McCann, Fergal ; McGuirk, Eoin F. |
Published in: |
Economics and Politics. - Wiley Blackwell. - Vol. 26.2014, 2, p. 263-284
|
Publisher: |
Wiley Blackwell |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Democratic accountability and the relative obstacles to foreign investment
Dorsch, Michael, (2011)
-
Democratic accountability, regulation and inward investment policy
Dorsch, Michael T., (2014)
-
The Illusory Leader: Natural Resources, Taxation and Accountability
McGuirk, Eoin F., (2010)
- More ...