The Direction of Foreign Direct Investment and International Migration between Developing and Developed Countries

• Main Authors: Sang Kyun Kim, Aditya Simha
• Format: Article
• Language: English
• Published: People & Global Business Association (P&GBA) 2012-03-01
• Series: Global Business and Finance Review
• Subjects: fdi; international migration; macro level process
• Online Access: http://www.gbfrjournal.org/pds/journal/thesis/20150622121159-TB4S8.pdf

Despite much research on foreign Direct Investment (FDI), there is seemingly a paucity of research on how international migration is related to inward and outward FDI. Focusing on the macro-level process, this article provides a theoretical rationale that accounts for the flow of FDI between a developing country and a developed country in a different stage. Specifically, we propose that international migration between the developing country and the developed country is increased by inward FDI which causes outward FDI consequentially; moreover, the difference in level of economic development between two countries exogenously influences the relationship. Our article contributes to the literature in the FDI field by providing a causal inference between inward/outward FDI and international migration.