Open Economies Review

, Volume 21, Issue 4, pp 565–588

Skilled Migration and Business Networks

Research Article

Abstract

The role of migrants’ networks in promoting cross border investments has been stressed in the literature, possibly making migration and FDI complements rather than substitutes in the long run. In this paper, we estimate the magnitude of such business network externalities in dynamic empirical models of FDI-funded capital accumulation. We use original data on capital and migration stocks rather than flows. Regarding migrants, we distinguish the total and skilled diasporas abroad. In both cross-sectional and panel frameworks, we find evidence of strong network externalities, mainly associated with the skilled diaspora.

Keywords

FDI Migration Brain drain Network Diaspora 

JEL Classification

F2 O15 Z13 

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Copyright information

© Springer Science+Business Media, LLC 2008

Authors and Affiliations

  1. 1.National Fund for Scientific ResearchWalloniaBelgium
  2. 2.IRES, Department of EconomicsUniversité Catholique de LouvainLouvain-La-NeuveBelgium
  3. 3.Université du Luxembourg, CREALuxembourgLuxembourg

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