U.S. Foreign Direct Investment in Latin America and the Caribbean: A case of Remittances and Market Size

Pablo Garcia-Fuentes, P. Lynn Kennedy and Gustavo F.C. Ferreira

No 142985, 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida from Southern Agricultural Economics Association

Abstract: This paper investigates the effect of remittances in attracting U.S. foreign direct investment flows to Latin America and the Caribbean (LAC). It uses an unbalanced panel data set for fifteen countries covering the period 1983-2010. The results suggest a positive and significant impact of remittances on U.S. FDI flows to LAC, but it depends upon the level of per capita GDP in the host country. Thus, a threshold of per capita GDP is needed for a country to benefit from the positive effect of remittances on U.S. FDI flows. Also, host country demand positively affects U.S. FDI flows to LAC, which supports the market size hypothesis.

Keywords: International; Development (search for similar items in EconPapers)
Pages: 33
Date: 2013-01-18
New Economics Papers: this item is included in nep-lam
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:saea13:142985

DOI: 10.22004/ag.econ.142985

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