POLITICAL RISKS IN FOREIGN DIRECT INVESTMENT: THE ECONOMIC FACTOR IN THE RISK OF POLITICAL VIOLENCE

The origin of the political violence has been investigated by politic and economic scientists from two different points of view: social grievance and greed. Econometric models based on greeds explain better the causes of modern conflicts. Their findings provide usefull and relevant information for multinational corporations, wich are exposed to a risk of loss in every developing country they operate. In order to obtain a rigurous assessment of the political violence risk based on academic research, it is essential to have a general view of the elemements related with conflicts and how they impact on the probability of loss. Therefore, it is essential to compare the findings of econometric studies and obtain the elements that cause conflicts. This is the first step to get the indicators to assess the risk of political violence.