Foreign Investment and Political Regimes
The Oil Sector in Azerbaijan, Russia, and Norway

Demonstrates that the political institutions of authoritarian regimes and consolidated democracies are better equipped to create attractive policies for investors.

Oksan Bayulgen (Author)

9781107436923, Cambridge University Press

Paperback / softback, published 21 August 2014

290 pages, 2 b/w illus. 7 tables
22.9 x 15.2 x 1.7 cm, 0.43 kg

'Bridging the disciplines of politics, economics, and business, Bayulgen provides a fine-grain analysis of the role of foreign investment in the development of the oil industry in three very different countries. Her thought-provoking conclusion is that hybrid political regimes are worse than either democracy or authoritarianism, because in such a regime the number of dimensions of uncertainty is increased.' Peter Rutland, Wesleyan University

Drawing on three in-depth case studies of oil-rich countries and statistical analyses of 132 countries over three decades, Bayulgen demonstrates that the link between democratization and FDI is nonlinear. Both authoritarian regimes and consolidated democracies have institutional capabilities that, though different, are attractive to foreign investors. Democracies can provide long-term stability, and authoritarian regimes can offer considerable flexibility. The regimes that have started on the road to democracy, but have not yet completed it, tend to have political institutions that provide neither flexibility nor stability. These hybrid regimes, then, also find it relatively more difficult to construct a policy environment that is attractive to foreign investments. These findings have deep implications for the link between democratization and globalization, but also how globalization may affect political, social, and economic development.

1. Introduction
2. Political risks in oil investments: a history of antagonistic interdependence
3. With or without democracy?: the political economy of FDI
4. Curse or blessing?: effects of FDI on development
5. Azerbaijan: one-stop shopping
6. Russia: two-steps forward, one-step back
7. Norway: icon of stability
8. Beyond three cases and oil
9. Conclusion.

Subject Areas: Political economy [KCP], Economic growth [KCG], Economics, finance, business & management [K], Comparative politics [JPB]