Premium
Foreign Direct Investment, Regime Type, and Labor Protest in Developing Countries
Author(s) -
Robertson Graeme B.,
Teitelbaum Emmanuel
Publication year - 2011
Publication title -
american journal of political science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 6.347
H-Index - 170
eISSN - 1540-5907
pISSN - 0092-5853
DOI - 10.1111/j.1540-5907.2011.00510.x
Subject(s) - foreign direct investment , developing country , investment (military) , international economics , business , economics , labour economics , political science , international trade , economic growth , macroeconomics , politics , law
We explore the relationship between FDI, regime type, and strikes in low‐ and middle‐income countries. We argue that FDI produces social tensions and opportunities for protest that can result in higher levels of industrial conflict. However, the effect of FDI is moderated by regime type. While democracies tend to have higher levels of protest overall, they are better able than authoritarian regimes to cope with the strains arising from FDI. We cite two reasons. First, political competition forces regimes to incorporate workers, which shifts conflict from industrial relations to the political arena. Second, democracies provide workers with freedom of association rights, which facilitate institutionalized grievance resolution. We test the argument using a new dataset of labor protest in low‐ and middle‐income countries for the period 1980–2005.