This project examines the evolution, features, and implications of the rapid growth of Investment Screening Mechanisms (ISM) in advanced industrialized democracies in recent years.

Foreign investment has long been seen as a force for peace because it has undergirded economic growth by providing a relatively stable source of capital and creating spillover effects of technology and know-how. In recent years, however, concerns have arisen that foreign investment could also become a tool for hostile actors to exert economic and political coercion and thus threaten national sovereignty and self-determination. How to balance the benefits and risks of economic openness has become a crucial challenge for policymakers in the new era of geopolitical competition.

Many advanced industrialized economies have recently implemented or expanded Investment Screening Mechanisms (ISMs), which empower governments to restrict foreign mergers and acquisitions, especially in strategic sectors.  The expansion of investment screening challenges accepted wisdom about the role of state authority in the global economy, the ways in which governments compete with each other for mobile capital, and the influence of electoral politics in shaping orientations toward the global market. Yet, though part of a growing trend towards the securitization and geopoliticization of economic policy, ISMs are an understudied phenomenon, both in the International Political Economy and International Security literatures. We know little about why they have increased exponentially in recent years, what explains variation in their design features, and what costs they impose on the various actors involved.

This project builds upon The Politics and Regulation of Investment Screening Mechanisms (PRISM) dataset, the first comprehensive dataset on screening laws in all 38 OECD countries from 2007-2021, which we created, as well as several recent publications, including “Mapping the Characteristics of Foreign Investment Screening Mechanisms: The New PRISM Dataset”, “Naïve no more: Foreign direct investment screening in the European Union”, and "If You Can’t Beat Them, Join Them: The Rise of Investment Screening in Europe in Comparative Perspective”.

The research assistants for this project are Joshua Wells ’24 and Dr. Lauren Konken, PhD 23.