Impacts of remittances on foreign direct investment in South East Asia - An empirical investigation

Abstract

This study investigates the effects of remittances on attracting foreign direct investment flows to South East Asia. Using a balanced panel data set for seven countries in the 2000-2013 period, we find that remittances have a direct positive impact on attracting FDI. Significantly, the result also shows a negative correlation between remittances and FDI attraction in countries with low per capita income and small market size.

Keywords

• foreign direct investment
• market size
• remittances
• south east asia.