Laws of Unintended Consequences: The Impacts of Anti-Foreign Bribery Laws on Developing Countries

Over the past quarter-century, the international community has grown increasingly aware of the deleterious impacts of corruption on economic growth, governance institutions, political stability, social freedoms and opportunities, and overall equality and efficiency within and across countries, with the effects most pronounced in the developing world. Corruption's ascent as a priority on the international development agenda has led to the emergence of a global anti-corruption regime engaging governments, civil society, business, and international organizations. Among the most prominent of these multilateral anti-corruption efforts has been the agreement among most of the world's leading economic powers to create legally binding standards that criminalize the bribery of foreign public officials. However, the existing literature examining the impacts of these anti-foreign bribery (AFB) laws has focused nearly exclusively on the statutes' effects on the competitiveness, costs, and investment decisions of regulated firms and individuals, with little investigation of the consequences of the multilateral AFB regime for the countries ostensibly harmed most by corruption - those in the developing world. This dissertation fills that gap in current law and development scholarship, using theoretical, anecdotal, and empirical evidence to identify how AFB laws change the incentives of foreign investors as well as government officials and to analyze how those shifts may ultimately affect the levels, sources, sectors, and types of foreign investment flowing into developing countries. It further considers the consequences of AFB laws for governance institutions and the magnitude and forms of corruption within less-developed countries. Examining critically the range of potential effects, it concludes that, under certain conditions in certain environments, laws prohibiting foreign bribery may undermine the developmental conditions in and prospects for poorer countries.S.J.D