Authoritarian Systems Beat Democracy in Attracting Foreign Investment in Asia.
The article explores how different political systems in China, India, and Taiwan affect foreign investment. China's authoritarian system attracts investment due to a credible environment and government efforts. India's democracy provides political security for investors, but flexible policies are needed for FDI. Taiwan's democratic transition balanced credibility and flexibility, leading to economic growth. The study shows that the relationship between political institutions and foreign investment depends on the trade-off between credibility and flexibility of governance.