The data for the analysis are drawn from the period between 1970 and 2016 in the U.S. This is
largely determined by data availability. They are time series data. Most data of the data used to
measure immigration policies were extracted from Migration Policy Institute and Federation for
Economics: The Open-Access, Open-Assessment E-Journal 14 (2020–15)
www.economics-ejournal.org
8
both the 2017
International Financial Statistics
, published by the International Monetary Fund,
and the 2017
World Development Indicator
, compiled by the World Bank. Descriptive statistics
for each variable are shown in Table 1.
Table 1:.
Descriptive Statistics
Observations
Mean
Std. Dev.
Minimum
Maximum
FDI Inflows
47
1.083
0.852
0.075
3.404
Refugee
ceiling per capita
37
0.036
0.018
0.022
0.102
Immigration law
47
0.191
0.398
0
1
Labor cost
47
90.677
17.118
51.1
111.2
Corporate tax
47
0.394
0.060
0.34
0.492
Regulation
47
124858.6
35234.66
54834
185053
Government expenditures
47
15.745
1.051
13.996
18.069
Economic growth
47
1.795
1.981
–3.624
6.334
Market size
47
19.375
0.141
19.139
19.594
Interest rate
47
4.106
2.365
0.585
8.720
Inflation
47
4.133
2.926
0.119
13.509.
Trade openness
47
21.220
5.383
13.730
30.885
Union membership
47
16.681
4.786
10.7
27.4
Dependent Variable
Because the article focuses on total foreign capital invested in the U.S., the dependent variable
is net inflows of FDI, including equity capital, reinvestment of earnings, other long-term capital,
and short-term capital, as shown in the balance of payments, giving a foreign investor a
management interest (10% or more of voting stock) in an enterprise. Rational firms are not
likely to relocate their plants and capitals to a region where they have already invested, so long
as the cost of maintaining their production facilities do not exceed benefits. Indeed, most foreign
firms are mobile
ex ante
, but relatively immobile
ex post
(Vernon, 1971). This suggests that the
FDI series is not constant across time. Thus, I model FDI as a percentage of GDP. FDI data are
taken from the Bureau of Economic Analysis.
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