Loose-Lipped Leviathan?Transparency in Private- and State-Owned Multinationals

Abstract

We bring together research and policy concern regarding MNE transparency with renewed interest in state capitalism. Using the global petroleum industry as a laboratory, we develop theory and examine empirically investment transparency – FDI disclosure in state-owned and private companies. We find that state ownership reduces MNE transparency, and that SOEs are less sensitive to host-country political risk than private firms. We also show that SOEs from more-democratic countries tend to behave more transparently, and that MNEs are more opaque when operating in countries with state-owned competitors.