Covert Confiscation: How Governments Differ in Their Strategies of Expropriation

Jane Esberg, Rebecca Perlman

Research output: Contribution to journalArticlepeer-review

2 Scopus citations


A substantial literature concludes that democratic-type institutions curb governments’ propensity to expropriate foreign direct investment. However, little attention has been paid to the strategies of expropriation regimes employ. We theorize that more politically constrained regimes will utilize expropriation methods that help them overcome institutional impediments. Using data on expropriations in developing countries between 1960 and 2014, we show that rather than rely on the most direct and overt forms of expropriation, constrained regimes tend to use more indirect and covert methods, such as forced sale or contract renegotiation, tools which can be harder to identify, easier to justify, and frequently face lower legislative approval hurdles. Indeed, while more politically constrained regimes are less likely to overtly expropriate foreign investment than less constrained regimes, they are nearly as likely to do so covertly, introducing new questions about the extent to which institutional constraints really translate into improved protections for foreign investors.

Original languageEnglish (US)
Pages (from-to)3-35
Number of pages33
JournalComparative Political Studies
Issue number1
StatePublished - Jan 2023

All Science Journal Classification (ASJC) codes

  • Sociology and Political Science


  • democratic advantage
  • expropriation
  • foreign direct investment
  • globalization
  • political economy


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