Kicking back against kickbacks: An examination of the Foreign Corrupt Practices Act and US foreign investment

• 成果类型: Article
• 署名作者: Jia, Weishi; Li, Shuo; Zhao, Jingran
• 署名单位: University System of Ohio; Cleveland State University; Western Washington University; Hong Kong Polytechnic University
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-021-00474-7
• 发表日期: 2022
• 页码: 326-343
• 关键词: bribery; CORRUPTION; Foreign direct investment; Legal enforcement; INSTITUTIONAL THEORY; difference-in-differences analysis

摘要

This paper studies the effect of the United States (US) Foreign Corrupt Practices Act (FCPA) on US multinational firms' foreign direct investment (FDI). Unlike prior studies that focused on the passage of the FCPA, our study examines how the actual enforcement of the FCPA affects firms' foreign investment decisions. We show that initial FCPA enforcement in a host country triggers MNEs to reassess their likelihood of being targeted, which in turn has a strong deterrence effect on subsequent US FDI growth in the host country. This deterrence effect is stronger for host countries with a weaker rule of law and more severe corruption issues. We did not find evidence of significant FDI relocation due to FCPA enforcement. Together, these results provide a comprehensive evaluation of the implications of FCPA enforcement in the global market for FDI.