This paper considers the relationship between assessments of institutional quality in developing countries and the innovative activities of multinational corporations. Firm entry mode literature has established links between domestic institutions and ownership equity patterns among multinationals, but institutionalist analyses have not adequately addressed the types of activities pursued by multinational firms. I argue that in addition to various socioeconomic indicators, the quality of domestic political institutions in developing countries is an important determinant of local innovative activity. I argue that institutional quality in host countries reinforces consistent patterns of interaction between states and firms, leading to reduced risk of technological expropriation and other undesirable outcomes for firms. I test this argument by examining the impact of institutional assessments, carried out by firms themselves and by outside observers, on R&D effort among multinationals, using firm-level surveys conducted in developing countries between 2002 and 2005. The multilevel empirical analysis suggests that multinational firms are likely to both locate R&D activities and pursue them intensively in developing countries with well-regarded institutions, and that the impact of institutional variables is more significant than other likely predictors, such as education levels in host countries.

We examine how economic change influences the supply of organized interests. Indeed, the economies of states have changed markedly since the turn of the century. State economies have grown, and the relative contributions of different economic sectors have changed. We use the Energy-Stability-Area model of interest system density to assess how these changes – along with changes in the productivity of different economic sectors in terms of generating organized interests – have influenced the size and composition of state interest communities from 1997 to 2007. We find that all three sources of economic change have uniquely contributed, and to a significant degree, to demographic change in state communities of organized interests.

Business and public partnerships in socially responsible behavior have become a central pillar of global governance, but one that is unevenly developed in different countries. Despite the transnational character of business operations, national context is of theoretical as well as policy significance. To explain cross-country variation in corporate commitment to social responsibility we investigate the political conditions that encourage firms to participate in the United Nations Global Compact. Drawing on a theory of corporate social responsibility as motivated by self-interest and external pressure, we examine the influence of external actors and the locally specific mobilization of bias. Analyzing participation levels in 145 countries, we find that a democratic regime and Global Compact participation by countervailing groups are associated with higher levels of business participation in the program. Contrary to earlier studies relying on smaller numbers of countries, we find no evidence that a country's relationship with the UN or the domestic political strength of environmental interests account for cross-national variation in corporate engagement with the Global Compact.

What explains the pattern of selective business interest in preferential trade agreements (PTAs) with active campaigning for and utilization of tariff preferences for some trade agreements, but not others? Under what conditions can business advocates of PTA policy mount an effective lobbying campaign to influence policy outcomes (i.e., shaping decisions on who to negotiate with and what to negotiate about)? These are important questions given that analyses of Asian PTAs frequently assign a negligible role to business interests either out of apathy or lobbying weakness. To understand the pattern of selective business lobbying for PTAs, I develop a theoretical model with three main independent variables: venue selection, preference intensity, and advocacy effectiveness, and apply it to the case of Japan to test its usefulness. My model shows that the conditions for effective business PTA campaigning are exacting: loss avoidance, high technical expertise, and influence-seeking strategies that maximize access opportunities given institutional constraints. And yet when these factors align, business interests do influence PTA outcomes. My research shows that the current trend to characterize the agency of PTA proliferation as either state-led or business-driven needs to be re-examined as it is more useful to think about state-society constellations in favor or against PTAs.

The paper illustrates a practical framework for understanding and predicting political economy risk for project managers operating in a variety of developing country settings, including non-democracies, ethnically diverse environments and societies undergoing political transition. In doing so, the paper also develops a number of novel cases illustrating the effectiveness of this framework in helping us understand both surprising success and failure in the realms of sustainable, private sector and human development. These cases include Tata Nano's difficulties in locating its automobile plant in West Bengal, how a small NGO, the Mehta Foundation, helped secure passage of green fuel mandates in Delhi over strong political opposition, and the sustained success of Mexico's pioneering conditional cash transfer program-Progressa/Oportunidades – in an environment of dramatic political regime change.