Despite suggestions that international investment disputes impose a chilling effect on governments' autonomy to set regulatory policies, we lack empirical confirmation of the phenomenon and what explains its heterogeneity across countries. Using a novel dataset of nine anti-smoking regulations in ninety-two countries from 1973 to 2016, I confirm the presence of the chilling effect, but also its boundaries. I show that countries have been significantly slower in implementing two anti-smoking policies formally challenged under investment law, while the adoption of seven undisputed regulations in this issue area continued unimpeded. Qualitative evidence from respondent and third-party governments confirm the policy-specificity of the chilling effect and show that both developed and developing countries were affected by the chill, albeit differently. By providing the first empirical confirmation of a regulatory chill and by defining its limited scope in one of the most high-profiled international investment disputes to date, my findings indicate that, even though multinational corporations can constrain state sovereignty, their effects are not necessarily expansive or indefinite.
CITATION STYLE
Moehlecke, C. (2020). The chilling effect of international investment disputes: Limited challenges to state sovereignty. International Studies Quarterly, 64(1), 1–12. https://doi.org/10.1093/isq/sqz077
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