Foreign Direct Investment and Political Uncertainty

Recent developments in the general equilibrium theory of multinationals emphasize the importance of multilateral considerations. Yet, existing explanations and corresponding estimations of FDI patterns have largely limited political and institutional investment impediments to a bilateral framework. Through the application of spatial econometric techniques, I demonstrate that the presence of both domestic and regional political uncertainty generate real options effects that lead to the delay or redirection of foreign direct investment. The magnitude and direction of these effects is conditional upon the host country regime type and the predominant multinational integration strategies in the region. Comparing these results with FDI of U.S. origin, I find evidence for divergent investment behavior by U.S. multinationals during regime changes in partner countries. Additionally, I find no evidence that multinationals from developing countries are more likely to complete cross-border deals in environments characterized by greater political risk or political uncertainty.

Quantum Gate and Quantum State Preparation through Neighboring Optimal Control

Successful implementation of fault-tolerant quantum computation on a system of qubits places severe demands on the hardware used to control the many-qubit state. It is known that an accuracy threshold Pa exists for any quantum gate that is to be used for such a computation to be able to continue for an unlimited number of steps. Specifically, the error probability Pe for such a gate must fall below the accuracy threshold: Pe < Pa. Estimates of Pa vary widely, though Pa ∼ 10−4 has emerged as a challenging target for hardware designers. I present a theoretical framework based on neighboring optimal control that takes as input a good quantum gate and returns a new gate with better performance. I illustrate this approach by applying it to a universal set of quantum gates produced using non-adiabatic rapid passage. Performance improvements are substantial comparing to the original (unimproved) gates, both for ideal and non-ideal controls. Under suitable conditions detailed below, all gate error probabilities fall by 1 to 4 orders of magnitude below the target threshold of 10−4. After applying the neighboring optimal control theory to improve the performance of quantum gates in a universal set, I further apply the general control theory in a two-step procedure for fault-tolerant logical state preparation, and I illustrate this procedure by preparing a logical Bell state fault-tolerantly. The two-step preparation procedure is as follow: Step 1 provides a one-shot procedure using neighboring optimal control theory to prepare a physical qubit state which is a high-fidelity approximation to the Bell state |β01⟩ = 1/√2(|01⟩ + |10⟩). I show that for ideal (non-ideal) control, an approximate |β01⟩ state could be prepared with error probability ϵ ∼ 10−6 (10−5) with one-shot local operations. Step 2 then takes a block of p pairs of physical qubits, each prepared in |β01⟩ state using Step 1, and fault-tolerantly prepares the logical Bell state for the C4 quantum error detection code.