Andy Spalding is spending the next year as a Fulbright Scholar at the University of Mumbai in India, where he will be studying corruption in international business. His first offering is a reconceptualization of the Foreign Corrupt Practices Act, the Watergate-era anti-bribery statute that many of us touch upon in Business Organizations. In Unwitting Sanctions: Understanding Anti-Bribery Legislation as Economic Sanctions against Emerging Markets, Andy argues that the statute should be viewed as a trade sanction, and that perspective leads to some interesting insights. Here is the abstract:
These perverse and unanticipated consequences create two policy problems. First, the sanctions literature suggests that the resulting foreign direct investment void may be filled by capital-rich countries that are not committed to effectively enforcing anti-bribery measures. This dynamic can be observed, for example, in China's aggressive investment in Africa, Latin America, and Central Asia, and creates myriad ethical, economic, and foreign policy problems. Second, by enforcing these laws without regard to their sanctioning effects, developed nations are unwittingly sacrificing poverty reduction opportunities to combat bribery. The paper concludes with various proposed reforms to the text and enforcement of international anti-bribery legislation that would further the goal of deterring bribery without deterring investment.
TrackBack URL for this entry:
Links to weblogs that reference The FCPA as Trade Sanction: