Closing the Institutional Gap : How Foreign Investors Shape Domestic Institutions in Emerging Markets

Reveals how multinational corporations reshape domestic institutions in emerging markets to protect their intellectual property-transforming weak rule-of-law environments from the inside out. A must-read for students and scholars of global politics, business, and law.

As multinational corporations (MNCs) expand their global presence, they actively shape the legal and institutional frameworks that govern foreign markets. Challenging the conventional view that firms primarily rely on external institutions to safeguard their property rights in countries with weak rule of law, this book argues that domestic institutions serve as critical arenas where MNCs advocate for stronger laws and enforcement, with a particular focus on intellectual property protection. Drawing on original datasets, survey experiments, and interviews with business executives, lawyers, and policymakers, Siyao Li reveals how home governments negotiate with host governments at the behest of MNCs, while the firms themselves play a central role in ensuring that these commitments translate into effective enforcement. At a time when global rule-making is shifting from multilateral cooperation towards bilateral negotiations and national-level policymaking, this book offers fresh insights into the evolving interplay of business power, state sovereignty, and global governance.