We estimate a gravity model for bilateral FDI out-stocks from panel data for OECD reporting countries with bilateral and year fixed effects. With this demanding test, we find a robust positive effect of bilateral immigrants on bilateral FDI - provided that residents of the two countries have few...

The European Commission is currently finalizing its proposed New Pact on Migration and Asylum to re-start the debate on how to reform the common European asylum system and manage immigration from non-EU countries. One prominent concern is the 'external dimension': jointly managing migration to...