Colonialism 561 Colonialism and international investment:the issues Debates over the role of foreign investment in confiict between investing and receiving societies and in conflict among investing countries have a long history.!Early in this century,Marxists and others carried on spirited polemics over the prospects for cooperation and conflict among advanced capitalist states in the context of dramatic increases in international investment and growing international strife (including World War I)that seemed to many to be tied to economically based colonial rivalries.2 The 1930s and 1940s gave rise to new debates over foreign investment and international conflict.3 Indeed,some of the impetus for the Bretton Woods institutions built during the early postwar years came from a desire to avoid problems associated with international investment that were perceived to have contributed to the political turmoil of the first half of the twentieth century.4 Elaborate plans to manage disputes among investing countries became superfluous,as such conflicts practically disappeared over the postwar period.5 Nonetheless,the topic remains interesting and important,for it involves enduring issues in international conflict and speaks to the relationship between international economics and politics. Unfortunately,the analysis of these issues is rife with confusing and often misleading arguments.Proposed explanations (independent variables)typi- cally are poorly specified;in fact,in the most prominent focus of the debate, they are close to meaningless.The things to be explained(dependent variables) similarly are poorly stated.Below,I try to reorganize both the independent and dependent variables to permit clearer analysis. 1.The most important recent contribution to the debate is Charles Lipson,Standing Guard Protecting Foreign Capital in the Nineteenth and Twentieth Centuries (Berkeley:University of California Press,1985).Lipson raises issues similar to those discussed here.Though his explanatory argument differs,it is not contradictory to that presented in this article. 2.Lenin and John Hobson were the two best-known analysts of these problems.Apart from Lenin's pamphlet Imperialism:The Highest Stage of Capitalism (New York:International Publish- ers,1939),a summary of his position is contained in V.I.Lenin,introduction to Imperialism and World Economty by Nikolai Bukharin (New York:International Publishers,1929),pp.9-14.An outstanding survey of Hobson's theoretical position can be found in Peter Cain,"f.A.Hobson, Financial Capitalism,and Imperialism in Late Victorian and Edwardian England,"Joumal of Imperial and Commonwealth History 13 (May 1985),pp.1-27. 3.The two most influential studies were those by Herbert Feis and by Eugene Staley,who looked at previous experiences,especially with European overseas investments,as a guide to potential future arrangements.See Herbert Feis,Europe,the World's Banker 1870-1914 (New Haven,Conn:Yale University Press,1930);and Eugene Staley,War and the Privare Investor (Garden City,N.Y.:Doubleday,Moran,and Co.,1935). 4.On the Bretton Woods negotiations,see Richard N.Gardner,Sterling-Dollar Diplomacy in Cument Perspecrive (New York:Columbia University Press,1980);and Armand Van Dormael, Bretton Woods (New York:Holmes and Meier,1978). 5.Contrarily,such plans simply may have been extraordinarily successful so as to render the issue of conflict obsalete.This possibility does not accord with the widespread impression that Bretton Woods institutions did very little of what they were intended to do,and very little at all until the 1960s