Refugees and foreign direct investment: Quasi-experimental evidence from US resettlements

Anna-Maria Mayda, Christopher Parsons, Han Pham, Pierre-Louis Vézina

We use the frameworks of two different US refugee dispersal policies to provide causal evidence that refugees promote outward foreign direct investment (FDI) to their countries and regions of origin. Using aggregated individual-level refugee data and project-level FDI data, we show that this effect is evident in terms of new FDI projects, capital investment, and job creation. Focusing specifically on Vietnam, we demonstrate that national domestic reforms have amplified the positive FDI effects of the overseas Vietnamese diaspora. Overall, our findings reveal a new mechanism through which refugees contribute to development in their home countries.

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