Migration and Foreign Direct Investment in the Globalization Context: the Case of a Small Open Economy

Artjoms Ivlevs ()

No 209, Development Working Papers from Centro Studi Luca d'Agliano, University of Milano

Abstract: The main objective of the paper is to establish the link between the exogenous migration shocks and endogenous foreign direct investment flows in a small open economy setting with international capital mobility, immobile labour and a non-traded good. I find that the immigration of the high-skilled individuals and FDI flows are always complements in the quantity sense. The immigration of the low-skilled individuals will cause an outflow (inflow) of capital, if domestic non-traded and imported goods are relatively weak (strong) substitutes in consumption. Besides, I explain the attitudes of native individuals towards high-skilled and low-skilled immigrants.

Keywords: international factor mobility; non-traded good; general equilibrium; imperfect import substitution (Armington assumption); direct democracy; EU enlargement (search for similar items in EconPapers)
JEL-codes: F21 F22 J61 (search for similar items in EconPapers)
Date: 2006-06-15
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:csl:devewp:209

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