Graduation Year
2026
Date of Submission
4-2026
Document Type
Open Access Senior Thesis
Degree Name
Bachelor of Arts
Department
Economics
Reader 1
William Lincoln
Terms of Use & License Information
Rights Information
©2026 Tianning Qin
Abstract
This paper examines how the absence of U.S. ambassadors impacts bilateral portfolio investment positions held by investors in the United States and counterpart countries. The panel dataset spans 2001 to 2019, covering 56 counterpart countries in terms of portfolio investment positions held by foreign investors in U.S. securities and 102 counterpart countries in terms of portfolio investment positions held by U.S. investors in foreign countries. Using the instrumental variable approach, the results show that a prolonged vacancy lasting at least three months in a year causes sizable and significant reductions in portfolio investments held by foreign investors in U.S. securities. Specifically, the reductions in total, debt, and long-term debt investment positions are statistically significant at the 5% level. These findings establish portfolio investment position as a previously unexamined channel through which ambassadorial vacancies impose real economic costs, and a genuine consequence of diplomatic appointment delays that policymakers ought to consider.
Recommended Citation
Qin, Tianning, "Diplomatic Gaps and Global Finance: How U.S. Ambassadorial Vacancies Affect Bilateral Portfolio Investment Positions" (2026). CMC Senior Theses. 4184.
https://scholarship.claremont.edu/cmc_theses/4184
