A great deal of political economy scholarship has focused on studying how countries can attract Foreign Direct Investment (FDI), and the effects that FDI has on growth and political stability. A related topic that has received almost no attention, however, is the divergent political reactions to...

Foreign direct investment (FDI) has come to be seen as a promising avenue for boosting economic development. As a consequence, most developing countries now seek to attract FDI, often by making ex ante promises to foreign investors not to pass laws or regulations — or refrain from other...