When Do Po­pulist Gover­n­ments De­ter Foreign Di­rect In­ve­st­ment?

A new study by Vera Kunczer, Thomas Lindner, and Srividya Jandhyala, published in the Journal of International Business Studies (JIBS), explores the conditions under which populist governments are more, or less, likely to deter foreign direct investment (FDI).

The study finds that:

• Pro-business regimes weaken the negative effect of populism on FDI.
• Strong anti-immigration stances amplify the adverse effect of populism on FDI.
• Regime alignment between home and host-country governments reduces the negative impact of populist governments on FDI.

In essence, FDI depends on whether foreign firms are perceived as belonging to the host regime's political "outgroup."

The article is available as open access and can be downloaded here.