Even Constrained Governments Steal: The Domestic Politics of Transfer and Expropriation Risks

63 Pages Posted: 14 Jul 2012 Last revised: 19 Jun 2017

See all articles by Benjamin A. T. Graham

Benjamin A. T. Graham

University of Southern California - School of International Relations

Noel P. Johnston

University of Oxford

Allison Kingsley

University of Vermont - Grossman School of Business

Date Written: March 26, 2015

Abstract

This paper analyzes an understudied and contested form of sovereign theft, transfer restriction, which has supplanted expropriation as the most ubiquitous and costly type of international property rights violation. Veto-player-type constraints curtail governments' ability to engage in outright and (non-transfer-related) creeping expropriation, but have little impact on their ability to seize wealth via transfer restrictions. We use a formal model to derive testable implications regarding the effect of political institutions and domestic politics on governments' ability to collect these two types of rent. Empirically, we use novel time-series-cross-sectional data to show that while veto-player-type political constraints diminish expropriation risk, transfer risk is much less affected: even constrained governments impose transfer restrictions.

Keywords: International Property Rights, Transfer RIsk, Expropriation, Political Risk, Foreign Investment, Veto-Players, Political Constraints, Development

JEL Classification: F21, F23, G15

Suggested Citation

Graham, Benjamin A. T. and Johnston, Noel P. and Kingsley, Allison, Even Constrained Governments Steal: The Domestic Politics of Transfer and Expropriation Risks (March 26, 2015). APSA 2012 Annual Meeting Paper. Available at SSRN: https://ssrn.com/abstract=2106621

Benjamin A. T. Graham

University of Southern California - School of International Relations ( email )

3518 Trousdale Parkway
VKC 330
Los Angeles, CA California 90089-0043
United States
8586996306 (Phone)
2137420281 (Fax)

HOME PAGE: http://https://dornsife.usc.edu/graham

Noel P. Johnston (Contact Author)

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Allison Kingsley

University of Vermont - Grossman School of Business ( email )

302 Kalkin Hall
Burlington, VT 05405-0158
United States
8026563464 (Phone)

HOME PAGE: http://allisonkingsley.com

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