"First Mover" Investment Advantages in Sub-Saharan Africa: Why Northern Multinationals Should React (Quickly) to Their Southern Counterparts

Direktinvestition; Multinationales Unternehmen; Standortfaktor; Afrika südlich der Sahara

Seeds of corruption - Do market institutions matter?

Ten years into the transition, corruption is so pervasive that it could jeopardize the best-intentioned reform efforts. The authors present an analytical framework for examining the role market institutions play in rent-seeking and illicit behavior. Using recently available data on the incidence of corruption, and on institutional development, they provide preliminary evidence on the link between the development of market institutions, and incentives for corruption. Virtually all of the indicators they examine appear to be important, but three are statistically significant: 1) the intensity of barriers to the entry of new business. 2) The effectiveness of the legal system. 3) The efficacy and competitiveness of services provided by infrastructure monopolies. The main lesson emerging from their analysis: a well established system of market institutions - clear and transparent rules, fully functioning checks and balances (including strong enforcement mechanisms), and a robust competitive environment - reduces opportunities for rent-seeking and hence incentives for corruption. Both the design, and effective implementation of such measures are important if a market system is to be effective. It is not enough, for example, to enact first-rate laws if they are not enforced. The local political economy greatly affects whether a given policy reform will curtail corruption. Especially important are the following factors in the political economy: a) the credibility of the government's commitment to carrying out announced reforms. B) The degree to which government officials are captured by the entities they regulate or oversee. C) the stability of the government itself. D) The political power of entrenched vested interests. Economists in the field of industrial organization, antitrust, and regulation have long recognized these factors as potent determinants of opportunistic behavior, corruption, and"capture"of government officials. Only now are they becoming conventional wisdom among specialists in economies in transition.Decentralization,International Terrorism&Counterterrorism,Economic Theory&Research,Environmental Economics&Policies,Legal Products,Governance Indicators,Legal Products,National Governance,Economic Theory&Research,Environmental Economics&Policies

The backstory of China and India's growing investment and trade with Africa:Separating the wheat from the chaff

Common misconceptions about China's and India's increasing FDI in Africa have arisen because of a lack of systematic evidence-based analysis. Empirically-derived data, including on comparator countries, need to be rigorously analysed within an objective and coherent framework so that policy conclusions can be drawn which will benefit the many stakeholders involved

Improving Russia's policy on foreign direct investment

Foreign direct investment brings host countries capital, productive facilities, and technology transfers as well as employment, new job skills, and management expertise. It is important to the Russian Federation, where incentives for competition are limited and incentives to becoming efficient are blunted by interregional barriers to trade, weak creditor rights, and administrative barriers to new entrants. The authors ague that the old policy paradigm of foreign direct investment (established before World War II and prevalent in the 1950s and 1960s) still governs Russia. In this paradigm there are only two reasons for foreign direct investment: access to inputs for production and access to markets for outputs. Such kinds of foreign direct investment, although beneficial, are often based on generating exports that exploit cheap labor or natural resources, or are aimed at penetrating protected local markets, not necessarily at world standards for price and quality. They contend that Russia should phase out high tariffs and non-tariff protection for the domestic market, most tax preferences for foreign investors (which don't increase foreign direct investment but do reduce fiscal revenues), and many restrictions on foreign investment. They recommend that Russia switch to a modern approach to foreign direct investment by: 1) Amending the newly enacted foreign direct investment law so that it will grant non-discriminatory"national treatment"to foreign investors for both right of establishment, and post-establishment operations, abolish conditions (such as local content restrictions) inconsistent with the World Trade Organization agreement on trade-related investment measures (TRIMs), and make investor-state dispute resolution mechanisms more efficient (giving foreign investors the chance to seek neutral binding international arbitration, for example). 2) Strengthening enforcement of property rights. 3) Simplifying registration procedures for foreign investors, to make them transparent and rules-based. 4) Extending guarantee schemes covering basic non-commercial risks.Environmental Economics&Policies,Labor Policies,International Terrorism&Counterterrorism,Economic Theory&Research,Payment Systems&Infrastructure,Environmental Economics&Policies,Foreign Direct Investment,Economic Theory&Research,National Governance,International Terrorism&Counterterrorism

Trials and Tribulations of Third World Petroleum Development: Lessons and Advice for Prospective Producers

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/73469/1/j.1477-8947.1987.tb00313.x.pd

How Natural Is Monopoly? The Case of Bypass in Natural Gas Distribution Markets

Public utility markets in the United States are commonly subject to both price and entry regulation. However, as dissatisfaction with much of the nation\u27s regulatory system has mounted within the last decade, the wisdom of protecting utilities from competitors has come increasingly under attack. Numerous court cases and administrative rulings by regulatory agencies, as well as developments in the economics literature. have pointed to the benefits of allowing existing buyers of a utility\u27s services to bypass the utility and transact for the services with either incumbent firms or new entrants. The issue of entry deregulation has been at the heart of debates over regulatory reform in such industries as telecommunications, cable and satellite television transmission, the postal service, and electricity generation

Drivers of Change or Cut-Throat Competitors? Challenging Cultures of Innovation of Chinese and Nigerian Migrant Entrepreneurs in West Africa

L'afflux remarquable des entrepreneurs migrants chinois dans différents pays d'Afrique occidentale au cours des dernières années a été heurtée à une résistance de plus en plus farouche par des entrepreneurs locaux établis. Que le premiers ont un avantage concurrentiel sur ce dernier en raison de traits socio-culturels distinctifs, ou si l'efficacité supposée chinoise est juste une caractéristique de toutes les diasporas mercantiles, est ouvert à la question. Cette étude exploratoire des migrants entrepreneuriales chinois et nigérians au Ghana et au Bénin tente de répondre à cette question. Apparemment, les forces culturels des agents du changement migrants ne sont pas limités à des systèmes de valeurs héritées ou religions, comme une éthique protestante ou le confucianisme, mais ils sont adaptés en permanence et ont inventé de nouveau par des réseaux transnationaux de la migration dans un monde globalisé. Il n'y a aucune preuve d'une prétendue supériorité de la culture d’innovation chinois par rapport aux cultures d’innovation africains des migrants entrepreneuriales. Plutôt, il existe une capacité accrue d'innovation d'une diaspora mercantile en général vis à vis des entrepreneurs locaux, indépendamment de l'origine de la culture nationale dans lequel il est intégré. En outre, la rivalité des entrepreneurs migrants chinois et nigérians dans les marchés africains ne conduit pas nécessairement à la concurrence coupe-gorge souvent suspectée sous l'impact de la mondialisation. Souvent, les deux groupes agissent plutôt complémentaires. Cela contribue, sous certaines conditions, même à la réduction de la pauvreté dans le pays d'accueil