Political Survival, Energy Policies, and Multinational Corporations

Marcelo Bucheli () and Ruth V. Aguilera
Additional contact information
Marcelo Bucheli: University of Illinois at Urbana-Champaign
Ruth V. Aguilera: University of Illinois at Urbana-Champaign

Management International Review, 2010, vol. 50, issue 3, No 4, 347-378

Abstract: Abstract We draw on the selectorate theory and detailed historical research to explain how a government relationship with foreign multinationals will depend on the strategies followed by the host country’s ruler to assure his/her political survival. Focusing in three oil-exporting countries (Colombia, Venezuela, and Mexico) and one firm (Standard Oil Company of New Jersey) during the twentieth century, we show that oil rents are a valuable resource for the host country’s ruler to assure the loyalty of his/her winning coalition. We argue that a government depending on a small winning coalition will use oil rents as a private good to be distributed among those close to the ruler, while a government relying on large coalitions will use oil rents as public goods to be distributed among the population. When acting against foreign multinationals, the host government is constrained by the political power of the firms’ home country over the host country and by the relationship between the firm and its home country. Finally, we show that shared political agendas between host and home governments give the host government more space to maneuver against foreign firms.

Keywords: Foreign direct investment; International political economy; Selectorate theory; Oil industry; Economic nationalism (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://link.springer.com/10.1007/s11575-010-0036-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:manint:v:50:y:2010:i:3:d:10.1007_s11575-010-0036-1

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/11575

DOI: 10.1007/s11575-010-0036-1

Access Statistics for this article

Management International Review is currently edited by Michael-Jörg Oesterle and Joachim Wolf

More articles in Management International Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().