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Migrants know better: Migrants' networks and FDI

Filippo Santi, Giorgia Giovannetti () and Margherita Velucchi

Working Papers - Economics from Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa

Abstract: We use the instruments of the social network analysis to revisit the relationship between international migration and Foreign Direct Investment (FDI) flows in the period between 2000 and 2015. Applying a multilevel mixed estimator inspired to the gravity literature, we test how and to what extent the structure of the international migrants’ network contributes to bilateral FDI flows. We find that the inclusion of network level statistics exposes a much larger degree of complexity in the relationship between international migration and investments. Testing the assumption that migrants networks act as preferential channel for information with their homeland, we find evidence that a more diverse immigrant community in investing countries could “perturb†the flow of information at bilateral level, de facto translating into lower bilateral FDI

Pages: 27 pages
Date: 2021
New Economics Papers: this item is included in nep-int, nep-mig, nep-net, nep-soc and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:frz:wpaper:wp2021_17.rdf

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