Hostname: page-component-586b7cd67f-dsjbd Total loading time: 0 Render date: 2024-11-25T20:20:17.984Z Has data issue: false hasContentIssue false
  • English
  • Français

Delayed Ratification: The Domestic Fate of Bilateral Investment Treaties

Published online by Cambridge University Press:  16 April 2013

Yoram Z. Haftel  and
Alexander Thompson
Yoram Z. Haftel
Affiliation:
Department of International Relations, Hebrew University of Jerusalem, Israel, and Department of Political Science, University of Illinois-Chicago. E-mail: [email protected]
Alexander Thompson
Affiliation:
Ohio State University, Columbus. E-mail: [email protected]
Get access

Abstract

Some treaties are signed and then ratified quickly while others languish in legal limbo, unratified by one or more parties. What explains this variation in the time between signature and ratification? The international relations literature has not taken the ratification stage seriously enough, despite its obvious importance from a legal and a political perspective. We offer a systematic study of this question in the context of bilateral investment treaties. We develop and test a set of theoretical propositions related to domestic-level constraints on the executive, the varying ability of governments to rationally anticipate ratification obstacles, and the bilateral relationship between treaty partners. We generally find support for these propositions but report some surprising findings as well. The article presents implications for investment agreements and treaty making more generally, and raises a number of issues for further study at the intersection of international politics and law.

Type
Research Article
Information
International Organization , Volume 67 , Issue 2 , April 2013 , pp. 355 - 387
Copyright
Copyright © The IO Foundation 2013

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Abbott, Kenneth W., and Snidal, Duncan. 2000. Hard and Soft Law in International Governance. International Organization 54 (3):421–56.CrossRefGoogle Scholar
Allee, Todd, and Peinhardt, Clint. 2010. Delegating Differences: Bilateral Investment Treaties and Bargaining over Dispute Resolution Provisions. International Studies Quarterly 54 (1):1–26.CrossRefGoogle Scholar
Allee, Todd, and Peinhardt, Clint. 2011. Contingent Credibility: The Impact of Investment Treaty Violations on Foreign Direct Investment. International Organization 65 (3):401–32.CrossRefGoogle Scholar
Bayulgen, Oksan. 2005. Foreign Investment, Oil Curse, and Democratization: A Comparison of Azerbaijan and Russia. Business and Politics 7 (1):1–37.CrossRefGoogle Scholar
Beck, Thorsten, Clarke, George, Groff, Alberto, Keefer, Philip, and Walsh, Patrick. 2001. New Tools in Comparative Political Economy: The Database of Political Institutions. World Bank Economic Review 15 (1):165–76.CrossRefGoogle Scholar
Blackhurst, Richard, Lyakurwa, Bill, and Oyejide, Ademola. 2000. Options for Improving Africa's Participation in the WTO. World Economy 23 (4):491–510.CrossRefGoogle Scholar
Blake, Daniel J.Forthcoming. Thinking Ahead: Government Time Horizons and the Legalization of International Investment Agreements. International Organization 67(4).Google Scholar
Boehmke, Frederick J., Morey, Daniel S., and Shannon, Megan. 2006. Selection Bias and Continuous-Time Duration Models: Consequences and a Proposed Solution. American Journal of Political Science 50 (1):192–207.CrossRefGoogle Scholar
Box-Steffensmeier, Janet M., Reiter, Dan, and Zorn, Christopher. 2003. Nonproportional Hazards and Event History Analysis in International Relations. Journal of Conflict Resolution 47 (1):33–53.CrossRefGoogle Scholar
Box-Steffensmeier, Janet M., and Zorn, Christopher. 2001. Duration Models and Proportional Hazards in Political Science. American Journal of Political Science 45 (4):972–88.CrossRefGoogle Scholar
Broz, J. Lawrence. 2002. Political System Transparency and Monetary Commitment Regimes. International Organization 56 (4):861–87.CrossRefGoogle Scholar
Busch, Marc L., Reinhardt, Eric, and Shaffer, Gregory. 2009. Does Legal Capacity Matter? A Survey of WTO Members. World Trade Review 8 (4):559–77.CrossRefGoogle Scholar
Büthe, Tim, and Milner, Helen V.. 2008. The Politics of Foreign Direct Investment into Developing Countries: Increasing FDI Through International Trade Agreements? American Journal of Political Science 52 (4):741–62.CrossRefGoogle Scholar
Büthe, Tim, and Milner, Helen V.. 2011. Institutional Diversity in Trade Agreements and Foreign Direct Investment: Credibility, Commitment, and Economic Flows in the Developing World, 1971–2007. Paper presented at the 107th Annual Meeting of the American Political Science Association, September, Seattle.Google Scholar
Cohen, Raymond. 1997. Negotiating Across Cultures: International Communication in an Interdependent World. Washington, D.C.: United States Institute of Peace Press.Google Scholar
Dai, Xinyuan. 2007. International Institutions and National Policies. New York: Cambridge University Press.CrossRefGoogle Scholar
Dolzer, Rudolf, and Stevens, Margrete. 1995. Bilateral Investment Treaties. The Hague, The Netherlands: Martinus Nijhoff.CrossRefGoogle Scholar
Downs, George W., Rocke, David M., and Barsoom, Peter N.. 1996. Is the Good News About Compliance Good News About Cooperation? International Organization 50 (3):379–406.CrossRefGoogle Scholar
Dunoff, Jeffrey L., and Pollack, Mark A.. 2012. Interdisciplinary Perspectives on International Law and International Relations: The State of the Art. New York: Cambridge University Press.CrossRefGoogle Scholar
Egger, Peter, and Pfaffermayr, Michael. 2004. The Impact of Bilateral Investment Treaties on Foreign Direct Investment. Journal of Comparative Economics 32 (4):788–804.CrossRefGoogle Scholar
Elkins, Zachary, Guzman, Andrew T., and Simmons, Beth A.. 2006. Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960–2000. International Organization 60 (4):811–46.CrossRefGoogle Scholar
Evans, Peter B., Jacobson, Harold K., and Putnam, Robert D., eds. 1993. Double-Edged Diplomacy: International Bargaining and Domestic Politics. Berkeley: University of California Press.CrossRefGoogle Scholar
Fearon, James D. 1998. Bargaining, Enforcement, and International Cooperation. International Organization 52 (2):269–305.CrossRefGoogle Scholar
Finnemore, Martha, and Sikkink, Kathryn. 1998. International Norm Dynamics and Political Change. International Organization 52 (4):887–917.CrossRefGoogle Scholar
Franck, Susan D. 2007. Empirically Evaluating Claims About Investment Treaty Arbitration. North Carolina Law Review 86 (1):1–87.Google Scholar
Gartzke, Erik, and Jo, Dong-Joon. 2002. The Affinity of Nations Index, 1946–1996. Version 3.0. Available at ⟨http://dss.ucsd.edu/~egartzke/datasets.htm⟩. Accessed 15 September 2011.Google Scholar
Goldstein, Judith, Kahler, Miles, Keohane, Robert O., and Slaughter, Anne-Marie, eds. 2001. Legalization and World Politics. Cambridge, Mass.: MIT Press.Google Scholar
Goldstein, Judith L., and Martin, Lisa L.. 2000. Legalization, Trade Liberalization, and Domestic Politics: A Cautionary Note. International Organization 54 (3):603–32.CrossRefGoogle Scholar
Goodliffe, Jay, and Hawkins, Darren G.. 2006. Explaining Commitment: States and the Convention Against Torture. Journal of Politics 68 (2):358–71.CrossRefGoogle Scholar
Grieco, Joseph M., Gelpi, Christopher F., and Camber Warren, T.. 2009. When Preferences and Commitment Collide: The Effect of Relative Partisan Shifts on International Treaty Compliance. International Organization 63 (2):341–55.CrossRefGoogle Scholar
Guzman, Andrew T., and Simmons, Beth A.. 2005. Power Plays and Capacity Constraints: The Selection of Defendants in WTO Disputes. Journal of Legal Studies 34 (2):557–98.CrossRefGoogle Scholar
Hafner-Burton, Emilie M., and Tsutsui, Kiyoteru. 2007. Justice Lost! The Failure of International Human Rights Law to Matter Where Needed Most. Journal of Peace Research 44 (4):407–25.CrossRefGoogle Scholar
Haftel, Yoram Z. 2010. Ratification Counts: U.S. Investment Treaties and FDI Flows into Developing Countries. Review of International Political Economy 17 (2):348–77.CrossRefGoogle Scholar
Haftel, Yoram Z., and Thompson, Alexander. 2012. When Do States Renegotiate International Agreements? The Case of Bilateral Investment Treaties. Paper presented at the 53rd Annual Convention of the International Studies Association, April, San Diego, Calif.Google Scholar
Hathaway, Oona A. 2007. Why Do Countries Commit to Human Rights Treaties? Journal of Conflict Resolution 51 (4):588–621.CrossRefGoogle Scholar
Hathaway, Oona A. 2008. Treaties' End: The Past, Present, and Future of International Lawmaking in the United States. Yale Law Journal 117 (7):1236–372.CrossRefGoogle Scholar
Hathaway, Oona A. 2009. Presidential Power over International Law: Restoring the Balance. Yale Law Journal 119 (2):140–268.Google Scholar
Henisz, Witold J. 2000. The Institutional Environment for Economic Growth. Economics and Politics 12 (1):1–31.CrossRefGoogle Scholar
Heston, Alan, Summers, Robert, and Aten, Bettina. 2011. Penn World Table Version 7.0. Center for International Comparisons of Production, Income and Prices at the University of Pennsylvania. Available at ⟨http://pwt.econ.upenn.edu/php_site/pwt70/pwt70_form.php⟩. Accessed 15 September 2011.Google Scholar
Hollis, Duncan B., Blakeslee, Merritt R., and Ederington, L. Benjamin. 2005. National Treaty Law and Practice. Leiden, The Netherlands: Martinus Nijhoff.CrossRefGoogle Scholar
Hollyer, James R., Rosendorff, B. Peter, and Vreeland, James Raymond. 2011. Democracy and Transparency. Journal of Politics 73 (4):1191–205.CrossRefGoogle Scholar
Hug, Simon, and König, Thomas. 2002. In View of Ratification: Governmental Preferences and Domestic Constraints at the Amsterdam Intergovernmental Conference. International Organization 56 (2):447–76.CrossRefGoogle Scholar
Jandhyala, Srividya, Henisz, Witold J., and Mansfield, Edward D.. 2011. Three Waves of BITs: The Global Diffusion of Foreign Investment Policy. Journal of Conflict Resolution 55 (6):1047–73.CrossRefGoogle Scholar
Keefer, Philip, and Stasavage, David. 2002. Checks and Balances, Private Information, and the Credibility of Monetary Commitments. International Organization 56 (4):751–74.CrossRefGoogle Scholar
Kelley, Judith. 2007. Who Keeps International Commitments and Why? The International Criminal Court and Bilateral Nonsurrender Agreements. American Political Science Review 101 (3):573–89.CrossRefGoogle Scholar
Koremenos, Barbara. 2005. Contracting Around International Uncertainty. American Political Science Review 99 (4):549–65.CrossRefGoogle Scholar
Krutz, Glen S., and Peake, Jeffrey S.. 2009. Treaty Politics and the Rise of Executive Agreements: International Commitments in a System of Shared Powers. Ann Arbor: University of Michigan Press.CrossRefGoogle Scholar
Kucik, Jeffrey, and Reinhardt, Eric. 2008. Does Flexibility Promote Cooperation? An Application to the Global Trade Regime. International Organization 62 (3):477–505.CrossRefGoogle Scholar
Lantis, Jeffrey S. 2009. The Life and Death of International Treaties: Double-Edged Diplomacy and the Politics of Ratification in Comparative Perspective. New York: Oxford University Press.Google Scholar
La Porta, Rafael, Lopez-de-Silanes, Florencio, and Shleifer, Andrei. 2008. The Economic Consequences of Legal Origins. Journal of Economic Literature 46 (2):285–332.CrossRefGoogle Scholar
Leblang, David. 2010. Familiarity Breeds Investment: Diaspora Networks and International Investment. American Political Science Review 104 (3):584–600.CrossRefGoogle Scholar
Leeds, Brett Ashley, Ritter, Jeffrey M., Mitchell, Sara McLaughlin, and Long, Andrew G.. 2002. Alliance Treaty Obligations and Provisions, 1815–1944. International Interactions 28 (3):237–60.CrossRefGoogle Scholar
Lipson, Charles. 1991. Why Are Some International Agreements Informal? International Organization 45 (4):495–538.CrossRefGoogle Scholar
Lipson, Charles. 2003. Reliable Partners: How Democracies Have Made a Separate Peace. Princeton, N.J.: Princeton University Press.Google Scholar
Manin, Bernard, Przeworski, Adam, and Stokes, Susan C.. 1999. Elections and Representation. In Democracy, Accountability, and Representation, edited by Przeworski, Adam, Stokes, Susan C., and Manin, Bernard, 29–54. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Mansfield, Edward D., Milner, Helen V., and Pevehouse, Jon C.. 2007. Vetoing Co-operation: The Impact of Veto Players on Preferential Trading Arrangements. British Journal of Political Science 37 (3):403–32.CrossRefGoogle Scholar
Marshall, Monty G., and Jaggers, Keith. 2011. Polity IV Project: Political Regime Characteristics and Transitions, 1800–2010. Dataset Users' Manual. Center for Systemic Peace. Available at ⟨http://www.systemicpeace.org/inscr/p4manualv2010.pdf⟩. Accessed 15 September 2011.Google Scholar
Martin, Lisa L. 2000. Democratic Commitments: Legislatures and International Cooperation. Princeton, N.J.: Princeton University Press.Google Scholar
Martin, Lisa L. 2005. The President and International Agreements: Treaties as Signaling Devices. Presidential Studies Quarterly 35 (3):440–65.CrossRefGoogle Scholar
Martin, Lisa L., and Simmons, Beth. 1998. Theories and Empirical Studies of International Institutions. International Organization 52 (4):729–57.CrossRefGoogle Scholar
Mayer, Frederick W. 1992. Managing Domestic Differences in International Negotiations: The Strategic Use of Internal Side-Payments. International Organization 46 (4):793–818.CrossRefGoogle Scholar
Milner, Helen V. 1997. Interests, Institutions, and Information: Domestic Politics and International Relations. Princeton, N.J.: Princeton University Press.Google Scholar
Milner, Helen V., and Judkins, Benjamin. 2004. Partisanship, Trade Policy, and Globalization: Is There a Left-Right Divide on Trade Policy? International Studies Quarterly 48 (1):95–119.CrossRefGoogle Scholar
Milner, Helen V., and Rosendorff, B. Peter. 1997. Democratic Politics and International Trade Negotiations: Elections and Divided Government as Constraints on Trade Liberalization. Journal of Conflict Resolution 41 (1):117–46.CrossRefGoogle Scholar
Moravcsik, Andrew. 2000. The Origins of Human Rights Regimes: Democratic Delegation in Postwar Europe. International Organization 54 (2):217–52.CrossRefGoogle Scholar
Moravcsik, Andrew, and Nicolaïdis, Kalypso. 1999. Explaining the Treaty of Amsterdam: Interests, Influence, Institutions. Journal of Common Market Studies 37 (1):59–85.CrossRefGoogle Scholar
Morrow, James D. 2007. When Do States Follow the Laws of War? American Political Science Review 101 (3):559–72.CrossRefGoogle Scholar
Neumayer, Eric. 2006. Self-Interest, Foreign Need, and Good Governance: Are Bilateral Investment Treaty Programs Similar to Aid Allocation? Foreign Policy Analysis 2 (3):245–67.CrossRefGoogle Scholar
Neumayer, Eric, and Spess, Laura. 2005. Do Bilateral Investment Treaties Increase Foreign Direct Investment to Developing Countries? World Development 33 (10):1567–85.CrossRefGoogle Scholar
Pahre, Robert. 2004. House Rules: Institutional Choice and United States Trade Negotiations. Conflict Management and Peace Science 21 (3):195–213.CrossRefGoogle Scholar
Pahre, Robert. 2008. Politics and Trade Cooperation in the Nineteenth Century: The “Agreeable Customs” of 1815–1914. New York: Cambridge University Press.Google Scholar
Pevehouse, Jon C. 2005. Democracy from Above: Regional Organizations and Democratization. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Pinto, Pablo M. 2013. Partisan Investment in the Global Economy: Why the Left Loves Foreign Direct Investment and FDI Loves the Left. New York: Cambridge University Press.CrossRefGoogle Scholar
Poulsen, Lauge, and Aisbett, Emma. 2013. When the Claim Hits: Bilateral Investment Treaties and Bounded Rational Learning. World Politics 65 (2).CrossRefGoogle Scholar
Powell, Emilia Justyna, and Mitchell, Sara McLaughlin. 2007. The International Court of Justice and the World's Three Legal Systems. Journal of Politics 69 (2):397–415.CrossRefGoogle Scholar
PRS Group. 2011. ICRG Methodology. Available at ⟨http://www.prsgroup.com/ICRG_Methodology.aspx⟩. Accessed 1 February 2011.Google Scholar
Putnam, Robert D. 1988. Diplomacy and Domestic Politics: The Logic of Two-Level Games. International Organization 42 (3):427–60.CrossRefGoogle Scholar
Raustiala, Kal. 2005. Form and Substance in International Agreements. American Journal of International Law 99 (3):581–614.CrossRefGoogle Scholar
Raustiala, Kal. 2012. NGOs in International Treatymaking. In The Oxford Guide to Treaties, edited by Hollis, Duncan B., chap. 6. New York: Oxford University Press.Google Scholar
Russett, Bruce, and Oneal, John. 2001. Triangulating Peace: Democracy, Interdependence, and International Organizations. New York: Norton.Google Scholar
Salacuse, Jeswald W. 2010. The Law of Investment Treaties. New York: Oxford University Press.CrossRefGoogle Scholar
Sauvant, Karl P., and Sachs, Lisa E.. 2009. The Effect of Treaties on Foreign Direct Investment: Bilateral Investment Treaties, Double Taxation Treaties, and Investment Flows. New York: Oxford University Press.CrossRefGoogle Scholar
Schneider, Christina J., and Urpelainen, Johannes. Forthcoming. Distributional Conflict Between Powerful States and International Treaty Ratification. International Studies Quarterly.Google Scholar
Setear, John K. 2002. The President's Rational Choice of a Treaty's Preratification Pathway: Article II, Congressional Executive Agreement, or Executive Agreement? Journal of Legal Studies 31 (S1): S5–S39.CrossRefGoogle Scholar
Shannon, Megan, Morey, Daniel, and Boehmke, Frederick J.. 2010. The Influence of International Organizations on Militarized Dispute Initiation and Duration. International Studies Quarterly 54 (4):1123–41.CrossRefGoogle Scholar
Simmons, Beth A. 2000. International Law and State Behavior: Commitment and Compliance in International Monetary Affairs. American Political Science Review 94 (4):819–35.CrossRefGoogle Scholar
Simmons, Beth A. 2009. Mobilizing for Human Rights: International Law in Domestic Politics. New York: Cambridge University Press.CrossRefGoogle Scholar
Slaughter, Anne-Marie, and Burke-White, William. 2006. The Future of International Law is Domestic (or, The European Way of Law). Harvard International Law Journal 47 (2):327–52.Google Scholar
Stasavage, David. 2002. Private Investment and Political Institutions. Economics and Politics 14 (1):41–63.CrossRefGoogle Scholar
Swan, Stewart J. 2008. Bilateral Investment Treaties as an Investment Promotion Mechanism: Testing the Effectiveness of the U.S. BIT Program. Paterson Review 9:1–17.Google Scholar
Tarar, Ahmer. 2001. International Bargaining with Two-Sided Domestic Constraints. Journal of Conflict Resolution 45 (3):320–40.CrossRefGoogle Scholar
Thompson, Alexander. 2010. Rational Design in Motion: Uncertainty and Flexibility in the Global Climate Regime. European Journal of International Relations 16 (2):269–96.CrossRefGoogle Scholar
Thompson, Alexander, and Verdier, Daniel. Forthcoming. Multilateralism, Bilateralism, and Regime Design. International Studies Quarterly.Google Scholar
Tobin, Jennifer L., and Rose-Ackerman, Susan. 2011. When BITs Have Some Bite: The Political-Economic Environment for Bilateral Investment Treaties. Review of International Organizations 6 (1):1–32.CrossRefGoogle Scholar
Tsebelis, George. 2002. Veto Players: How Political Institutions Work. Princeton, N.J.: Princeton University Press.CrossRefGoogle Scholar
United Nations Conference on Trade and Development (UNCTAD). 2006. The Entry into Force of Bilateral Investment Treaties (BITs), IIA Monitor No. 3 International Investment Agreements, United Nations Document UNCTAD/WEB/ITE/IIA/2006/9. New York: United Nations.Google Scholar
United Nations Conference on Trade and Development (UNCTAD). 2008. World Investment Report: Transnational Corporations, and the Infrastructure Challenge, United Nations Document UNCTAD/WIR/2008. New York: United Nations.Google Scholar
United Nations Conference on Trade and Development (UNCTAD). 2009. Inward and Outward Foreign Direct Investment Flows, Annual, 1970–2011. Available at ⟨http://unctadstat.unctad.org/ReportFolders/reportFolders.aspx⟩. Accessed 17 September 2009.Google Scholar
Urpelainen, Johannes. 2011. Early Birds: Special Interests and the Strategic Logic of International Cooperation. Review of International Organizations 6 (2):113–40.CrossRefGoogle Scholar
von Stein, Jana. 2005. Do Treaties Constrain or Screen? Selection Bias and Treaty Compliance. American Political Science Review 99 (4):611–22.CrossRefGoogle Scholar
von Stein, Jana. 2008. The International Law and Politics of Climate Change: Ratification of the United Nations Framework Convention and the Kyoto Protocol. Journal of Conflict Resolution 52 (2):243–68.CrossRefGoogle Scholar
von Stein, Jana. 2010. Exploring the Universe of United Nations Human Rights Agreements. Paper presented at the 68th Annual Conference of the Midwest Political Science Association, April, Chicago.Google Scholar
Vreeland, James Raymond. 2008. Political Institutions and Human Rights: Why Dictatorships Enter into the United Nations Convention Against Torture. International Organization 62 (1):65–101.CrossRefGoogle Scholar
World Bank. 2010. World Development Indicators. Washington, D.C.: World Bank. Available at ⟨http://data.worldbank.org/data-catalog/world-development-indicators/wdi-2010⟩. Accessed 15 September 2011.Google Scholar
Yackee, Jason Webb. 2008. Bilateral Investment Treaties, Credible Commitment, and the Rule of (International) Law: Do BITs Promote Foreign Direct Investment? Law and Society Review 42 (4):805–31.CrossRefGoogle Scholar
Supplementary material: File

Haftel and Thompson supplementary material

Appendix and data

Download Haftel and Thompson supplementary material(File)
File 756.5 KB