Labor Mobility and the Geography of Globalized Production

• In Event: Poster Session: International Political Economy I

Abstract

How do policies that shape geographic labor mobility influence over-time trends in foreign direct investment flows? Harnessing theoretical models from the new economic geography literature, I argue that labor mobility policy is a crucial ingredient for attracting export-oriented FDI. When governments allow for the free movement of workers across space, they promote the creation of agglomeration economies, attracting multinational investment in the process. Using data on export-oriented FDI by American firms to 55 countries from 1983 to 2015, I find that labor mobility policy increases foreign direct investment inflows, particularly in lower-income countries. I also point the way toward future research on the role of labor mobility politics in determining the geography of globalized production.

Author

• Benjamin Clay Helms, University of Virginia