Abstract
This paper explores
whether remittance contributes to Foreign Direct Investment (FDI). We use data
collected by the World Bank for 89 countries on remittance. The sample included
66 developing and 23 developed countries from 2007 to 2021. We use a
multi-linear regression model. We demonstrate that remittance is essential to
FDI flow into a country. In particular, remittance has a more significant
impact in attracting FDI flow into developing countries than developed
countries. Additionally, remittance has a more substantial impact on attracting
FDI inflow into African countries than Asian countries. The result supports our
hypothesis that remittance affects FDI. The result has significant implications
for policymakers and governments of these different regions.
