Replication Data for: Does Armed Conflict Reduce Foreign Direct Investment in the Petroleum Sector

Existing studies argue that armed conflict reduces foreign direct investment (FDI) or, following rational expectations theory, should not affect FDI. In this paper, I offer a new theory on how armed conflict affects FDI, which encompasses the interaction between political risk and market conditions and provides a systematic explanation for investors’ divergent responses including an opportunistic behavior. To do so, I present a formal model focusing on a commodity's price, which is a key to investors’ profits and is also influenced by political risk. The model demonstrates that investors do not necessarily reduce FDI against political risk if armed conflict is expected to increase profit by increasing commodity prices, ceteris paribus. Statistical analysis of 50 countries that received FDI in the petroleum sector from 1980 to 2006 reveals that armed conflict (intrastate and interstate) reduces FDI in petroleum. However, it also shows that the effect of armed conflict on FDI in petroleum varies depending on oil prices. Consistent with the predictions, I find that investors do not decrease investment as oil prices get higher. An additional analysis on US FDI in petroleum from 1982 to 2006 also confirms the finding. This insight adds a new dimension to a current debate about the relationship between conflict and FDI.

既有研究认为，武装冲突会抑制外商直接投资（Foreign Direct Investment, FDI），亦有观点依据理性预期理论（rational expectations theory）提出，武装冲突对FDI并无影响。本文提出一套关于武装冲突如何影响FDI的全新理论框架，该框架涵盖政治风险与市场条件的交互作用，可为投资者的差异化反应（包括机会主义行为）提供系统性解释。为此，本文构建了一个聚焦大宗商品价格的形式化模型（formal model）：大宗商品价格既是影响投资者收益的核心因素，同时也受政治风险的制约。该模型表明，若其他条件不变（ceteris paribus），当武装冲突有望通过推高大宗商品价格提升投资收益时，投资者未必会为规避政治风险而缩减FDI。本文对1980年至2006年间50个石油行业引入外商直接投资的国家开展统计分析，结果显示：武装冲突（国内冲突与国家间冲突，intrastate and interstate）会抑制石油行业的FDI。但该分析同时表明，武装冲突对石油行业FDI的影响会随油价水平产生异质性变化。与模型预测一致，本文研究发现：当油价走高时，投资者并不会缩减投资规模。针对1982年至2006年间美国石油行业外商直接投资的补充分析，同样验证了上述研究结论。该研究视角为当前有关冲突与FDI关系的学术辩论增添了全新维度。