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Foreign Direct Investment and Territorial Disputes

Bibliographic Data

ID6284459
AuthorsHoon Lee (0000-0002-0549-5028, Texas Tech University), Stephen Mark Mitchell (0000-0003-3804-9259, University of Iowa), Sara Mclaughlin Mitchell (University of Iowa)
Year2012
Volume56
Issue4
Pages675-703
Publication date2012-08-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueJournal of Conflict Resolution (JOURNAL)
Journal identifiersISSN: 0022-0027 • E-ISSN: 1552-8766
PublisherSAGE Publications Inc (PUBLISHER)
DOI10.1177/0022002712438348
OpenAlexW2106718628
LanguageEN
Citations received38
References cited85

This study evaluates the relationship between foreign direct investment (FDI) and interstate conflict, focusing on four prominent causal mechanisms: the declining benefits of territorial conquest, increasing preference similarity, increasing opportunity costs of violence, and improved information signaling. Empirical analyses show that new territorial issues are less likely to arise as global levels of FDI increase, although monadic and bilateral FDI flows have no effect on states’ decisions to start new issue claims. Higher bilateral FDI flows between two disputants significantly reduce the chances for escalation to high levels of violence over issues and improve the chances for peaceful management. Increasing global levels of FDI also reduce the chances for severe militarized conflicts. Opportunity costs are an important mechanism linking FDI and states’ conflict management practices, as the pacifying effect of bilateral and monadic FDI on militarized conflict becomes stronger in dyads with a history of militarization over the issues at stake

Business · Conflict management · Economic interdependence · Economics · Foreign direct investment · International conflict · International economics · International trade · Militarization · Political science · Politics · International Business and FDI · International Development and Aid · Law · Political Conflict and Governance

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Unique citing works38
Citations per year2,92
Citation span2013 - 2026 (14)
Citation velocitycurrent
Highly citedNo
Citation typesNeutral: 37

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