Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100361
Authors: 
Kessing, Sebastian
Hefeker, Carsten
Year of Publication: 
2014
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2014: Evidenzbasierte Wirtschaftspolitik - Session: Environmental Aspects of International Trade A16-V2
Abstract: 
We study the role of competition for the hold-up problem in foreign direct investment in resource-based industries. The host country government is not only unable to commit not to expropriate investment ex post, but is also unable to commit to the provision of local resources. In the case of competition for local resources this dual commitment problem triggers higher investment levels, increases host countries revenues, but hurts profits of international investors. Domestic firms can play a similar role as an alternative instrument for host country governments to generate higher foreign investment in an environment of weak property rights.
JEL: 
F21
F23
Q34
Document Type: 
Conference Paper

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