Rather than focus on the decision of an investor in country j, scholarly work in this tradition centers on understanding how politicians in country i demonstrate that they are credibly committed to the preservation of stable and liberal markets. Empirically these studies ask whether different institutional structures help solve the commitment problem and provide borrowing countries with better access to international capital markets. One set of scholarly contributions argues that domestic political institutions can signal a commitment to the protection of property rights. These contributions are of two related types. The first identifies the nature.
