Suchergebnisse

It is a commonly held view that democracy is better at safeguarding environment while autocracy is predatory in nature, and is thus insensitive towards environment. However, others argue that democracy leads to environmental degradation. We revisit this contentious relationship between regime type and environment degradation in the context of deforestation. Using panel data on 139 countries during the 1990–2012 period, we find that democracy is associated with lower levels of forest coverage. Although our results appear counter-intuitive, further analyses reveal the positive effect of democracy on forest area coverage is conditional upon the level of economic development. Roughly, at per capita income of about US$8200, the impact of democracy on forest coverage becomes positive. Our results suggest that a democratic government's priority to tackle environmental problems depends on its level of economic development. These results also highlight the fundamental reason as to why there is a lack of coordinated effort between developing and developed countries in addressing environmental issues.

The consequences of foreign direct investment (FDI) for human rights protection are poorly understood. We propose that the impact of FDI varies across industries. In particular, extractive firms in the oil and mining industries go where the resources are located and are bound to such investment, which creates a status quo bias among them when it comes to supporting repressive rulers ("location-bound effect"). The same is not true for non-extractive MNCs in manufacturing or services, which can, in comparison, exit problematic countries more easily. We also propose that strong democratic institutions can alleviate negative impacts of extractive FDI on human rights ("democratic safeguard effect"). Using US FDI broken up into extractive and non-extractive industries in 157 host countries (1999-2015), we find support for these propositions. Extractive FDI is associated with more human rights abuse, but non-extractive FDI is associated with less abuse, after controlling for other factors, including concerns about endogeneity. We find also that the negative human rights impact of extractive FDI vanishes in countries where democratic institutions are stronger. Our results are robust to a range of alternative estimation techniques.