Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/68194
Authors: 
Filer, Randall
Stanišić, Dragana
Year of Publication: 
2012
Series/Report no.: 
CESifo Working Paper: Monetary Policy and International Finance 3998
Abstract: 
Current literature shows a significant negative impact of terrorism on countries economies. We explore this relationship in more detail. Using an unbalanced panel of over 160 countries for up to 25 years and the Global Terrorism Database (GTD) we show a decrease in FDI as a consequence of terrorism. We also find evidence that FDI flows are more sensitive to terrorism than either portfolio investments or external debt flows. Finally, we test the hypothesis that terrorism has negative spill-over effects on FDI flows into neighboring countries and find evidence that cultural but not geographical closeness matters.
Subjects: 
FDI
terrorism
lending
portfolio investment
JEL: 
F20
Document Type: 
Working Paper

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