Diaspora Impact on Foreign Direct Investment: State Institutions on Diaspora Engagement

Abstract In a globalized and interdependent world, every country needs cooperation partnership. the framework of this mission, state undertakes policies reforms that impose radical internal changes. Supporting these changes requires financial human resources states are trying to secure through various sources. Diaspora is in fact first catalyst provides incentives economy meet national with helps overcome relative isolation from global trade flows. Through engagement diaspora, extending their political administrative functions beyond borders agreements improving relationships other countries. This stimulates interest foreign investors who always looking for new markets, less expensive, rich natural FDI capital currency it brings, technological innovation, development, opening contributes economic growth country. words, power given by law can create bridge communication between two fundamentally different phenomena. So, purpose paper investigate relationship institutions created support level Then we go analysis study if type institution engaged issue matters. We use data collected public sources panel econometric models estimated sample 20 countries over 30-year period (1990-2020). Panel was conducted, implementing three (Pooled Model, Fixed Effect, Random Effect) Our results initially show diaspora variable positively correlated volume statistically significant. Second, based on results, conclude that, regardless there significant positive effect attraction FDI.