Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 16, 2022 erstellt
Beschreibung:
Using Facebook friendship links as a proxy for social ties for a large set of country pairs across the world, this paper shows that cross-country social connectedness is an important determinant of foreign direct investment (FDI). We find that social connections can account for a significant share of more traditional cross-country determinants such as distance. Importantly, we show that social connections can help to overcome three different types of investment hurdles: information asymmetries, bad institutions, and global (macroeconomic) uncertainty. To strengthen identification, we exploit migration and genetic distance as instruments