In this article we explore the relationship between the investments of multinational corporations (foreign direct investment) and income inequality in Mexico. We argue that Mexico's liberalization of foreign direct investment (FDI) inflows in the 1990s provides a natural experiment to test how FDI affects income inequality in a middle-income country. We use an instrumental variables approach as our identification strategy to mitigate problems of endogeneity and omitted variable bias. In an empirical test of the determinants of changes in income inequality from 1990 to 2000, we find that increased FDI inflows are associated with a decrease in income inequality within Mexico's thirty-two states.The authors would like to thank Lawrence Broz, John Freeman, Matt Gabel, Geoff Garrett, Quan Li, Eddy Malesky, Layna Mosley, Katie Ridgeway, Pablo Pinto, John Stringer, and Andy Sobel for comments and suggestions. Jacob Gerber and Mariana Medina provided excellent research assistance. Thanks also to Patricio Aroca Gonzalez for generously providing us with his data. We acknowledge the financial support of the Weidenbaum Center on the Economy, Government, and Public Policy. Nate Jensen's contribution to this article was written as a Global Fellow at UCLA's International Institute.

This article investigates the politics of sovereign borrowing in Europe over the very long run. I consider three alternative hypotheses regarding the sources of borrower credibility. According to the first, European states with constitutional checks on executive authority found it easier to obtain credit at low interest rates than did states that lacked such constraints. My second hypothesis focuses on state type (city-state versus territorial state) and the way in which this may have influenced the balance of political power between owners of land and owners of capital in a society. This hypothesis suggests that after controlling for other factors, one should observe that city-states in Europe found it easier to borrow than did larger territorial states, and that these city-states paid lower interest rates on their debt. Finally, my third hypothesis suggests that borrower credibility depended on the simultaneous presence of both constitutional checks and balances and a city-state. When one considers a broad sample of cases over a long time span there is strong support for the proposition involving city-states and merchant power, but less support for the argument that constitutional checks influenced credibility regardless of state type (city-state or territorial state). There is, however, some empirical evidence of an interaction effect whereby constitutional constraints on rulers made city-states particularly credible as borrowers. My results are robust to a number of controls for alternative determinants, for sample selection bias, and for the endogeneity of city-state development.I would like to thank Robert Fannion, Jeff Frieden, Peter Gourevitch, Lisa Martin, Adam Przeworski, Ronald Rogowski, Jean-Laurent Rosenthal, Ken Scheve, Mike Tomz, Nikki Velasco, two anonymous referees, and seminar participants at Stanford and UCLA for comments on a previous draft. This research was supported by the Economic and Social Research Council (UK).

The view that unemployment is caused by labor market rigidities and should be addressed through systematic institutional deregulation has gained broad currency and has been embraced by national and international policymaking agencies alike. It is unclear, however, whether there really is robust empirical support for such conclusions. This article engages in an econometric analysis comparing several estimators and specifications. It does not find much robust evidence either of labor market institutions' direct effects on unemployment rate, or of a more indirect impact through the magnitude of adverse shocks. At the same time, we find little support for the opposite, proregulatory position as well: the estimates show a robust positive relationship between union density and unemployment rates; also, there is no robust evidence that the within-country variation of bargaining coordination is associated with lower unemployment (as frequently argued), nor is it clear that bargaining coordination moderates the impact of other institutions. All in all, restrictive monetary policies enacted from an independent central bank and other determinants of real interest rates appear to play a more important role in explaining unemployment than institutional factors.Many thanks to participants in the 2d CofFEE Europe Workshop, as well as Peter Auer, Emilio Castilla, Rob Franzese, Andrew Glyn, Lane Kenworthy, Bernhard Kittel, Stephen Nickell, Michael Piore, Naren Prasad, and Marco Vivarelli for comments on previous versions of this article.

Previous institutional explanations of trade policy have focused on the role of proportional representation on the promotion of free trade. This explanation generates numerous unsolved anomalies and provides limited guidance in explaining the difference between proportional representation countries and between majoritarian countries as well as within-country variation in trade policy. This article introduces a more general institutional theory that argues that the number of access points provided by institutions is the crucial institutional feature, as increasing the number of access points makes lobbying less costly, which benefits protectionists. From this, I hypothesize that the number of parties in government, the number of electoral districts, the nature of the vote, and other such institutions affect the level of protection and that, once these factors are controlled for, proportional representation has no impact on trade policy. I test this theory on tariff data in the post–World War II developed democracies and find broad support for these hypotheses.This article was previously presented at the 2004 Annual Meetings of the Midwest Political Science Association. I would like to thank Alan Deardorff, Rob Franzese, Matt Golder, Mike Hanmer, Jude Hays, Cherie Maestas, Corrine McConnaughy, Will Moore, James D. Morrow, Won-Ho Park, and Jeff Staton for advice and comments and Yoshi Ono for excellent research assistance. All errors, of course, remain my own.

A large literature concludes that democracy has ambiguous effects on public policy and that political checks and balances exacerbate crisis. The analysis in this article finds that although democracies are no less likely to experience banking crises, in the event of financial crisis, competitively elected governments intervene more rapidly in insolvent banks and make transfers to them that are between 10 and 20 percent of gross domestic product less than those made by nondemocratic governments. Their countries suffer far smaller growth collapses. However, political checks and balances have no effect on government responses to financial crisis. A simple model offers new explanations for these regime effects. First, for those public policies for which voter information and political credibility are particularly likely to be problematic (financial regulation), electoral accountability matters only when the consequences of failure become large and visible (financial crisis). Second, checks and balances reduce political incentives to seek rents, offsetting the delays they induce in crisis response. The analysis in this article underlines the importance of considering regime effects on political incentives to cater to special interests at the expense of broad social interests, and of avoiding aggregated and subjective measures of democracy that can obscure the identification of regime effects.This article benefited from the generous comments of George Clarke, Robert Cull, and Patrick Honohan, and from those of participants at the 6th International Conference on Finance and Development, Moscow 2005; and in seminars at the University of California, Los Angeles, Universität Basel, and the Inter-American Development Bank.

Why do some issues but not others galvanize transnational advocacy networks? To gain insight into this question, I studied how advocates in the human rights sector think and talk about an issue that has received little advocacy attention to date: stigma against children born of wartime rape. Focus groups with humanitarian practitioners were coded and analyzed for evidence of a variety of explanations for issue adoption drawn from the literature on advocacy networks. The analysis suggests that the conditions for issue adoption are constituted by dynamics across, rather than primarily within, issue networks.This project was supported by National Science Foundation Grant No. SES 0432488 and by a Hewlett Research Grant from University of Pittsburgh's University Center for International Studies. I am deeply indebted to Stuart Shulman and University of Pittsburgh's Qualitative Data Analysis Program for assistance with Atlas.ti software, and to Laurel Person, Abbie Zahler, Betcy Jose-Thota, Vanja Lundell, Rachel Helwig, and Justin Reed for assistance in coding and data analysis. Vera Achvarina, Lisa Alfredson, David Bearce, Clifford Bob, Daniel Chong, Jack Donnelly, Michael Goodhart, John Mendeloff, Joel Oestreich, Simon Reich, Stephen Rothman, Ben Rubin, Nita Rudra, Laura Sjoberg, Dan Thomas, and participants in Yale University's Genocide Studies Seminar Series provided helpful feedback on earlier drafts. I am solely responsible for any remaining errors.