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Research Summary
Research Summary
  • Research Summary

Profitable Souls: Foreign Investment and the Fate of Human Rights

By: Debora L. Spar
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    Description

    This is a project about foreign investment, about what happens when big multinational firms invest in small, poor, and often nasty places. Typically, most observers assume that this is a largely negative relationship: that multinationals exploit the local population, embolden brutal dictators, and destroy the natural environment. And oftentimes they do. Yet sometimes foreign investment has more beneficial effects. Sometimes it actually paves the way for progress in a developing state and advances the state of human rights. Profitable Souls attempts to distinguish between these two radically different outcomes, describing when foreign investment destroys human rights and when it can help them.

    The topic of human rights, of course, is both subtle and complex. It encompasses a wide range of alleged 'rights' - the right to life, the right to privacy, the right to equality - and an even wider range of controversy: when does the right to life begin? How is equality defined? What if the right to privacy entails a threat to life? Profitable Souls is not intended as a discourse on these topics. Instead, it starts with a straightforward approach to rights, one that concentrates on the basic qualities of life: if starving people gain access to food, or illiterate children find education, their human rights improve. Undeniably, this definition of rights will raise eyebrows among those who study the topic or protest on its behalf. But it is also most relevant to understanding the direct link between foreign investment and human conditions; the link between multinationals and the populations they affect.

    What makes this topic particularly intriguing is the vast range of experience that it encompasses. Foreign investment, after all, takes many forms, and over time, the pendulum of public opinion has swung back and forth, with multinationals painted as either the demons of third world development or the beacons of change.

    This project takes a different tack. Rather than arguing that foreign investment is either good or bad, it explores various types of investment across time and space, examining how a specific investment operates and what chain of events it unleashes. Do certain kinds of investment force the foreign firm to embrace local governments? Does the amount of imported capital matter? Or the nationality of the investor? What role is played by the media, or by activists who rail against global capitalism? Using a combination of statistical, historical, and on-site analyses, the project attempts to sort through these questions.

    Debora L. Spar

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