Bilateral Investment Treaties and Foreign Direct Investment

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Title Bilateral Investment Treaties and Foreign Direct Investment
Author Min, Byung-Seong; Mujumdar, Sudesh; Rhim, Jong C.
Journal Name Global Business & Finance Review
Editor Jong C. Rhim
Year Published 2011
Place of publication United States
Publisher The Global Business and Finance Association
Abstract This paper investigates the relationship between bilateral investment treaties (BITs) and foreign direct investment (FDI) inflows using random coefficient panel models, and accounting for the regime shift that occurred with the 1997 Asian Financial Crisis. The examination results reveal that BITs have a strong positive impact on FDI inflows for the pre-1997 era. However, the strength of this positive impact diminishes as more BITs are concluded, implying that each additional BIT yields a relatively smaller FDI-payoff. No statistically significant impact of BITs on FDI inflows is found for the period following the Asian Financial Crisis, implying a decline in their relative importance in attracting FDI. Further, BITs do not have a stronger impact on FDI inflows for developing countries in comparison to developed countries.
Peer Reviewed Yes
Published Yes
Publisher URI
Copyright Statement Copyright 2011 Global Business and Finance Review. The attached file is reproduced here in accordance with the copyright policy of the publisher. Please refer to the journal's website for access to the definitive, published version.
Volume 16
Issue Number 1 (Spring)
Page from 75
Page to 87
ISSN 1088-6931
Date Accessioned 2011-05-30
Language en_AU
Faculty Griffith Business School
Subject International Business
Publication Type Journal Articles (Refereed Article)
Publication Type Code c1

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