This article contends that Bilateral Investment Treaties (BITs) with strong, legally enforceable protections for foreign investors negatively impact human rights practices in developing nations.
Foreign investment treaties create two key dynamics:
* Guarantee initial conditions appealing to investors
* Channel subsequent investments toward sectors favored by these conditions
* Create constraints during trade and investment competition periods
* Prevent governments from freely providing welfare benefits or basic infrastructure without investor concerns being secondary
These combined pressures contribute significantly to public discontent in host countries.
However, enforceable BIT provisions also limit government flexibility regarding investors, thereby reducing the 'cost' of human rights violations.
The study finds that this adverse effect is moderated by democratic governance. Evidence from 113 developing countries between 1981 and 2009 supports these conclusions.
| Investor Rights versus Human Rights: Do Bilateral Investment Treaties Tilt the Scale? was authored by Cristina Bodea and Fangjin Ye. It was published by Cambridge in BJPS in 2020. |
