Migration and Cross-Border Financial Flows
Migration facilitates the flow of information between countries, thereby reducing informational frictions that potentially hamper cross-country financial flows. Using a gravity model, migration is found to be highly correlated with financial...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/586241493123886865/Migration-and-cross-border-financial-flows http://hdl.handle.net/10986/26475 |
| Summary: | Migration facilitates the flow of
information between countries, thereby reducing
informational frictions that potentially hamper
cross-country financial flows. Using a gravity model,
migration is found to be highly correlated with financial
flows from the migrant's host country to her home
country. The correlation is strongest where information
problems are more acute (e.g., between culturally more
distant countries), for asset types that are more
informational sensitive, and for the type of migrants that
are most able to enhance the flow of information on their
home countries, namely, skilled migrants. These differential
effects are interpreted as evidence for the role of
migration in reducing information frictions between countries. |
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