Abstract
Whether to decrease reliance on foreign lending, or recover from economic crisis, a comparative advantage among other emerging markets that attracts foreign direct investment (FDI) can contribute significantly towards country development.1 How do states make credible commitments to this end, especially those whose ability to implement policy is shaped by a recent democratic transition? Credible commitments are intended to mitigate the hazards of complex transactions over space and time.2 Policies made by the state that prove effective and enforceable, such as economic or political reform, can accomplish this to the extent they reduce costs associated with economic activity.3
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© 2006 Albert A. Gonzalez
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Gonzalez, A.A. (2006). Credible Commitments and the Relevance of State Capacity: Mexico’s Foreign Direct Investment under the NAFTA. In: Motamen-Samadian, S. (eds) Economic and Financial Developments in Latin America. Centre for the Study of Emerging Markets Series. Palgrave Macmillan, London. https://doi.org/10.1057/9780230504455_6
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DOI: https://doi.org/10.1057/9780230504455_6
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