The Impact of Terrorism on Foreign Direct Investment: Which Sectors are More Vulnerable?

Author

Shivani Agrawal, Claremont McKenna CollegeFollow

Graduation Year

Fall 2011

Document Type

Open Access Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

S. Brock Blomberg

Terms of Use & License Information

Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© 2011 Shivani Agrawal

Abstract

The impact of conflict and violence on foreign direct investment (FDI) is not a topic that has been done justice by the literature, and what few studies exist have contradictory results. This paper studies the impact that transnational terrorism has on FDI inflows by economic sector, in developed countries. Results indicate a statistically significant negative correlation between terrorist events and total FDI inflows. Amongst a list of 12 broad industrial sectors, FDI inflows for manufacturing, trade and repair, and construction were found to have a statistically significant negative correlation with terrorist events.

Recommended Citation

Agrawal, Shivani, "The Impact of Terrorism on Foreign Direct Investment: Which Sectors are More Vulnerable?" (2011). CMC Senior Theses. 124.
https://scholarship.claremont.edu/cmc_theses/124