Pellegrino, Bruno; Spolaore, Enrico; Wacziarg, Romain - National Bureau of Economic Research - 2021
asset positions. We estimate this gravity equation using recently-developed foreign investment data that have been restated … four barriers (geographic distance, cultural distance, foreign investment taxation, and political risk) accounts for a … large share of the observed variation in bilateral foreign investment positions. Our model predicts (out of sample) a …