Many developing countries have become increasingly activist toward multinational corporations in recent years. A number of governments have significantly altered the national regime for foreign direct investment (FDI) in order to shift ownership and control toward the host country. The national regime for FDI is the set of rules, regulations, and behavioral norms under which foreign enterprises are expected to operate. Foreign investment regime change can occur in a number of ways (formal expropriation, cancellation of contracts or concessions, alteration of taxation and royalty formulae, limitations on profit repatriation, requirements of local equity participation, etc.) that affect the operational autonomy and financial returns of the foreign firm. This paper will present a theory to explain one aspect of foreign investment regime change: the formal nationalization or expropriation of foreign-owned subsidiaries operating in natural resource extraction.

This article updates earlier work by Haas, Butterworth, and Nye on conflict management by international organizations. In addition, it seeks to answer the question of whether one can fruitfully interpret conflict management as a case of regime growth and regime decay. For this purpose I develop indicators of regime coherence and regime effectiveness, and illustrate them by subjecting the management of disputes to time-series analysis. The discussion identifies when and under what global conditions the regime began to decay. Finally, I explain that decay in terms of four mutually supportive hypotheses. In this article I thus offer a statistical history of the conflict management functions of the United Nations and the major regional organizations, and use it to probe the limits of the utility of the regime literature.

Creating institutions that effectively manage interstate conflict is a priority for policy-makers. In this article we demonstrate that military allies are well positioned to influence the crisis-bargaining behavior of both challengers and targets in ways that often lead to peace. Through a three-player game-theoretic model, we demonstrate that a target's alliances not only have an effect on the demand that the challenger makes, but also on the behavior of the target. When a target values an alliance highly, an ally's recommendation for settlement can encourage the target to concede to demands without further escalation. Our statistical analysis provides evidence in support of the theoretical finding. Allies can both deter challengers and restrain partners, and as a result, can encourage peaceful behavior not only from adversaries, but from member states as well. Our study thus sheds new light on the role of military alliances as potential conflict management devices.

This article reconciles common policy usage with scholarly definition. The system of cooperation on non-proliferation has often been termed an international “regime,” but there has not been any systematic effort to determine if this is actually true. The discussion also attempts to reconcile the formation and maintenance of this system of cooperation with contemporary international relations theory. The central argument is that the system of international cooperation on non-proliferation does constitute a regime, but that such a regime presents a serious anomaly for contemporary theory. The article concludes that power and egoistic self-interest are inadequate to account for the regime's formation and maintenance. The inadequacies of both the hegemonic stability and functional theories point towards another independent variable that needs central consideration in regime analysis: knowledge and learning.

In a key finding in the democratic peace literature, Mansfield and Snyder argue that states with weak institutions undergoing incomplete transitions to democracy are more likely to initiate an external war than other types of states. We show that the empirical data do not support this claim. We find a dearth of observations where incomplete democratizers with weak institutions participated in war. Additionally, we find that the statistical relationship between incomplete democratization and war is entirely dependent on the dismemberment of the Ottoman Empire prior to World War I. We also find that the case selection in Mansfield and Snyder rarely involved incomplete democratizers with weak institutions. We therefore conclude that the finding that incomplete democratizers with weak institutions are more likely to initiate or participate in war is not supported by the empirical data.

This article examines the effect of cartography on the development of the modern state system. I argue that new mapping technologies in early modern Europe changed how actors thought about political space, organization, and authority, thus shaping the creation of sovereign states and international relations. In particular, mapping was fundamental to three key characteristics of the medieval-to-modern shift: the homogenization of territorial authority, the linearization of political boundaries, and the elimination of nonterritorial forms of organization. Although maps have been interpreted as epiphenomenal to political change, each of these three transformations occurred first in the representational space of maps and only subsequently in the political practices of rulers and states. Based on evidence from the history of cartographic technologies and their use by political actors, the practices and texts of international negotiations, and the practical implementation of linearly bounded territoriality by states, this article argues that changes in the representational practices of mapmaking were constitutive of the early-modern transformation of the authoritative structure of politics. This explanation of the international system's historical transformation suggests useful new directions for investigations into the possibility of fundamental political change due to the economic, social, and technological developments of globalization.

As they pursue their goals, actors—whether individuals, groups, or states—attempt to consume goods and services of various types. Generally they try to obtain such goods through private action. Thus, individuals clothe and entertain themselves by means of their individual actions in various marketplaces. Similarly, states will attempt to achieve goals and put policies into effect through their own actions. They will trade with other countries, develop defensive capabilities, and produce scientific knowledge substantially through their own efforts. States behave, then, as if they were private consumers in a market economy.

There is significant variation in the design of military alliances but scholars currently do not have a good understanding of when members choose one design over another. This article argues that alliance design is motivated, at least in part, by reliability considerations. If concerns about opportunism are high—when prospective members have a history of alliance violation—the signatories should be more willing to implement costly reliability-enhancing provisions such as greater precision in when alliance obligations apply, issue linkage, and increased institutionalization. However, this should be more likely in symmetric alliances where members of similar power levels rely on the support of their partners and thus sensitivity to opportunism is high. In asymmetric alliances, major powers may not find reliability-enhancing provisions necessary and minor powers, who do worry about the reliability of their partners, are unable to force more costly alliance designs given their limited bargaining power. The theoretical expectations are tested using data on bilateral alliances between 1919 and 2001 and the results are generally supportive of the hypotheses.

Do nuclear weapons offer coercive advantages in international crisis bargaining? Almost seventy years into the nuclear age, we still lack a complete answer to this question. While scholars have devoted significant attention to questions about nuclear deterrence, we know comparatively little about whether nuclear weapons can help compel states to change their behavior. This study argues that, despite their extraordinary power, nuclear weapons are uniquely poor instruments of compellence. Compellent threats are more likely to be effective under two conditions: first, if a challenger can credibly threaten to seize the item in dispute; and second, if enacting the threat would entail few costs to the challenger. Nuclear weapons, however, meet neither of these conditions. They are neither useful tools of conquest nor low-cost tools of punishment. Using a new dataset of more than 200 militarized compellent threats from 1918 to 2001, we find strong support for our theory: compellent threats from nuclear states are no more likely to succeed, even after accounting for possible selection effects in the data. While nuclear weapons may carry coercive weight as instruments of deterrence, it appears that these effects do not extend to compellence.

If competing beliefs about political events in the world stem largely from information asymmetries, then more information and knowledge should reduce the gap in competing perceptions. Empirical studies of decision making, however, often find just the reverse: as knowledge and the stakes in play go up, the beliefs about what is happening polarize rather than converge. The theory proposed here attributes this to motivated reasoning. Emotions inside the observer shape beliefs along with information coming from the outside world. A series of experiments embedded in a national survey of Americans finds that a primary driver of the beliefs someone forms about globalization, other countries, and the politics in the Middle East is how strongly they attach their social identity to the United States. Attachment produces more intense positive and negative emotions that in turn shape the interpretation of unfolding events and lead norms to be applied in an inconsistent fashion. People, in effect, rewrite reality around their favored course of action, marrying the logic of appropriateness to their own preferences. Beliefs, consequently, are not independent of preferences but related to them. Motivated reasoning, while not consistent with rational models, is predictable and can lead to expensive mistakes and double standards that undermine liberal internationalism.

In research on the political economy of exchange rates, a good understanding of who will endorse and who will oppose certain exchange-rate policies is central to understanding how actual exchange-rate policies are made and how the global exchange-rate system changes over time. Since existing classifications of exchange-rate level preferences have several shortcomings, this article proposes a new and more nuanced strategy for identifying preferences on exchange-rate valuation. This approach takes into account the complex interrelationship between exchange-rate and monetary policy, and the effects of these policies on balance sheets. In addition, the approach accounts for the dynamics of preference formation and change. Comparative case studies of currency crises in Hong Kong, South Korea, Thailand, and Taiwan show that considering actors' vulnerabilities to exchange-rate and interest-rate changes enhances understanding of their exchange-rate level preferences. The case studies also indicate that societal preferences affect policy outcomes. Exchange-rate stability was maintained in countries where private actors' vulnerabilities to depreciation were high. However, when pressure intensified, exchange rates were subsequently depreciated in countries where vulnerabilities to a monetary tightening exceeded the potential costs of depreciation.

When popular referendums fail to ratify new international agreements or succeed in reversing existing ones, it not only affects domestic voters but also creates negative spillovers for the other parties to such agreements. We explore how voters respond to this strategic environment. We use original survey data from a poll fielded just one day before the 2015 Greek bailout referendum—a referendum in which the stakes for other countries were particularly high—to investigate how expectations about the likely foreign response to a noncooperative referendum outcome influence voting behavior and to what extent foreign policymakers can influence those expectations. Our analysis of the Greek referendum shows that such expectations had a powerful effect on voting behavior: voters expecting that a noncooperative referendum outcome would force Greece to leave the eurozone were substantially more likely to vote cooperatively than those believing that it would result in renewed negotiations with the country's creditors. Leveraging the bank closure that took place right before the vote, we also show that costly signals by foreign actors made voters more pessimistic about the consequences of a noncooperative vote and substantially increased the share of cooperative votes.

Under the same systemic shock, the collapse of the international economy in 1929, different countries formulated different policy responses. Britain, Germany, the United States, France, and Sweden all began by attempting the orthodoxy of deflation. Soon after, they abandoned deflation, devalued their currencies, erected tariff barriers, and set up corporatistic production and marketing arrangements. A few countries went further, and began experimenting with demand-stimulus fiscal policy. The most successful was Nazi Germany; the Swedish and U.S. efforts were much more limited and less effective, the French attempt crumbled in less than a year, and Britain never tried demand stimulus. Why this divergence in policy? The politics of policy response, the societal basis of different policy coalitions and the way in which they were expressed through different political formulations, suggests an answer. In all countries, labor, agriculture, and certain elements of business became available for revolts against policy orthodoxy. What differed across countries was the specific balance of forces among these interest groups, and the political factors that shaped their combinations. The effect of political leadership, institutions, and other variables on outcomes depended critically on the way specific social forces in each society used and worked through them.

One of the most important puzzles of twentieth-century international relations is why the American conception of security vis-à-vis the European Powers shifted from unilateralism to internationalism after World War II but not after World War I. In this article I document that this shift was measurably one of collective ideas and explain the transformation. Scholarship on the sea change in American global thinking has been hampered by the lack of attention to the broader issues of when and why collective ideas change. To address this gap I offer a general framework to account for ideational change: I highlight the interaction between collective ideas and events that allows individuals and societies to overcome barriers to ideational change in some circumstances but not others. This argument clarifies the otherwise puzzling development of American ideas and offers a template for understanding change in other areas.

We address the question of how international public goods are financed by analyzing voting in the U.S. Congress on legislation to increase the U.S. contribution to the International Monetary Fund (IMF). We argue that legislators are more likely to vote in favor of an increase (1) the more campaign contributions they obtain from banks that specialize in international lending, and (2) the greater the share of high-skilled “proglobalization” workers in their districts. The first argument supports the inference that a financially strong IMF mitigates the risks of international lending, to the benefit of the lending banks. The second reflects our claim that voters view the IMF as a positive force for global economic integration that—following Stolper-Samuelson reasoning—benefits high-skilled workers. Lastly, we analyze IMF loan decisions and find modest support for the claim that IMF policy reflects the interests of major international banks. Overall, our results suggest that private actors within the United States have individual stakes in funding the IMF.We presented earlier versions of this paper at the 8th Annual International Society for New Institutional Economics Conference (ISNIE), Tucson, Ariz., September–October 2004, and at the Delegation to International Organization Conference, Del Mar, Calif., September 2003. We thank participants for comments. We also thank Michael Hiscox, Mathew McCubbins, J. R. DeShazo, David Lake, Jeffry Frieden, James Vreeland, William R. Clark, Erica Gould, Joseph Joyce, Devesh Kapur, Louis Pauly, Shanker Satyanath, Beth Simmons, and Michael Tierney for suggestions; and Mark Farrales and Molly James for excellent research assistance.

Scholarship on the determinants of foreign direct investment (FDI) flows has produced valuable insights into the role of host state characteristics and home-host relations. This study draws attention to another factor in investment decisions—the political and economic relations that home and host states maintain with third-party states. More narrowly, we focus on how investors respond to their home-state's imposition of economic sanctions against a trading partner. Greater economic integration has allowed states to use economic sanctions more frequently in recent decades. At the same time, economic sanctions are thought to have a distorting effect on global trade and financial flows as firms and governments adjust to new constraints. We argue that as firms at home in the sanctioning state respond to coercive measures against a trading partner by looking for alternative sources of profit, they will shift investments to states that can provide indirect access to the sanctioned economy. In particular, those states that are perceived as prospective sanctions-busters—major trading partners of the sanctions target or states with a history of sanctions-busting behavior—will benefit disproportionately from the misfortune of others. We test this conjecture using data on US economic sanctions and global flows of US FDI from 1966 to 2000. The findings reveal that investor decision making in part responds to political developments beyond the home-host dyad.

This paper blends recent research on hierarchy and democratization to examine the theoretical and empirical costs of treating regime type exogenously in the literature most identified with studying its impact on international politics. It argues that the apparent peace among democratic states that emerges in the aftermath of World War I is not caused by domestic institutional attributes normally associated with democracy. Instead, this peace is an artifact of historically specific great power settlements. These settlements shape subsequent aggregate patterns of military conflict by altering the organizational configuration of the system in three critical ways—by creating new states, by altering hierarchical orders, and by influencing regime type in states. These claims are defended with a series of tests that show first how the statistical relationship between democracy and peace has exhibited substantial variation across great power orders; second, that this statistical relationship breaks down with theoretically motivated research design changes; and third, that great powers foster peace and similar regime types within their hierarchical orders. In short, the relationship between democracy and peace is spurious. The international political order is still built and managed by great powers.

If different producer groups have divergent interests concerning macroeconomic policies, how do societal preferences translate into state policy outcomes? I develop and test a party-as-agent framework for understanding the importance of societal preferences with regard to monetary policy under capital mobility. Following the principal-agent model, political parties function as agents for different societal principals. Rightist parties tend to represent internationally oriented business groups with preferences for monetary convergence, while leftist parties do the same for domestically oriented groups preferring monetary autonomy under capital mobility. I present statistical evidence showing that OECD leftist governments have been associated with more monetary autonomy and currency variability than their rightist counterparts, even after controlling for basic economic indicators such as inflation. The statistical evidence also shows that societal group size tends not to explain either autonomous monetary policy choices or exchangerate stability. Thus even large and wealthy societal groups may be unable to obtain their preferred policy outcome when their respective partisan agents do not hold government power.

In this article we examine the effects of interest group pressure and the structure of political institutions on infrastructure deployment by state-owned electric utilities in a panel of seventy-eight countries during the period 1970–94. We consider two factors that jointly influence the rate of infrastructure deployment: (1) the extent to which the consumer base consists of industrial consumers, which are capable of exerting discipline on political actors whose competing incentives are to construct economically inefficient “white elephants” to satisfy the demands of concentrated geographic interests, labor unions, and national engineering and construction lobbies; and (2) veto points in formal policymaking structures that constrain political actors, thereby reducing these actors' sensitivity to interest group demands. A higher fraction of industrial customers provides political actors with stronger incentives for discipline, reducing the deployment of white elephants and thus the infrastructure growth rate, ceteris paribus. Veto points reduce political actors' sensitivity to interest group demands in general and thus moderate the relationship between industrial interest group pressure and the rate of infrastructure deployment.Both authors contributed equally and list their names alphabetically on this joint work. Both authors acknowledge funding for this research from the University of California Energy Institute. Zelner acknowledges additional funding from the Lynde and Harry Bradley Foundation and the Edgar F. Kaiser Chair at the Haas School of Business, University of California, Berkeley. Henisz acknowledges additional funding from the Reginald H. Jones Center for Management Policy, Strategy, and Organization at the Wharton School, University of Pennsylvania. Thanks to Severin Borenstein, Rachel Croson, José de la Torre, Alexander Dyck, Tom Gilligan, Florencio Lopez-de-Silanes, Edward Mansfield, Mathew McCubbins, Will Mitchell, David Mowery, Jeffrey Nugent, Dennis Quinn, George Tsebelis, Joel Waldfogel, Oliver Williamson, and Jan Zabojnik for their comments on previous drafts. Any errors are the responsibility of the authors.