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Temporary migration and foreign direct investment

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Author Info

  • Daniela Federici

    (University of Cassino)

  • Marilena Giannetti

    (University of Rome "La Sapienza")

Abstract

The question of complementarity or substitutability of FDI and international labour mobility has not yet been answered. The substitutability assumption does not take into consideration the technological spillover of FDI in the host countries. Moreover, migration flows reveal cultural characteristics and labour force properties of their native country which may stimulate bilateral business networks, strengthening the complementarity assumption between capital and labour flows. In this paper we build a continuous time dynamic model where these offsetting forces are at work. We analyze whether, and to what extent, the increase of labour mobility might affect FDI outflows. A numerical simulation is performed showing that to a higher labour mobility corresponds a higher income growth rate. Some policy implications and further research direction are suggested.

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Bibliographic Info

Paper provided by Universita' di Cassino, Dipartimento di Scienze Economiche in its series Working Papers with number 2008-03.

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Length: 29 pages
Date of creation: Mar 2008
Date of revision:
Handle: RePEc:css:wpaper:2008-03

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Postal: Dipartimento di Scienze Economiche Via S. Angelo Loc. Folcara 03043 Cassino (FR) - Italy
Phone: +3907762994734
Fax: +3907762994834
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Web page: http://www.eco-giu.uniclam.it/Dipartimento/Info
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Related research

Keywords: Temporary Migrations; Migrant Network; FDI; Dynamic Model; European Union;

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References

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Citations

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Cited by:
  1. Masood Gheasi & Peter Nijkamp & Piet Rietveld, 2011. "Migration and Foreign Direct Investment: Education Matters," Tinbergen Institute Discussion Papers 11-136/3, Tinbergen Institute.
  2. Masood Gheasi & Peter Nijkamp & Piet Rietveld, 2011. "Migration and Foreign Direct Investment: Education Matters," Tinbergen Institute Discussion Papers 11-136/3, Tinbergen Institute.
  3. Lastauskas, Povilas & Bičiūnaitė, Audrė, 2012. "Strategies for Deeper Integration: Case Study of the Baltics," MPRA Paper 43321, University Library of Munich, Germany.

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