A Literature Review of the Nexus between Migration and Internationalization

PublicationArticle (with peer review)
Foreign Direct Investment, information, Migration, networks, Trade

Abstract

Protectionism and anti-globalization tides have been rising already before the COVID-19 pandemic, with Brexit and the China-U.S. trade war, as two examples. A continued disruption to global trade, investment and value chains could worsen global development. Economic recovery will require restoring firms’ ability to trade, offshore and invest globally. To achieve this, it will be useful to understand the role of migration for foreign trade, investment and other aspects of internationalization. In this paper we review and discuss over 100 papers published about migrants’ roles on international trade, foreign direct investment and offshoring. Although the evidence suggests that migration facilitates trade and internationalization, we also note substantial gaps and inconsistencies in the existing literature. The aim of this paper is to encourage further research and assist policymakers in their efforts to promote economic recovery including internationalization.

Hatzigeorgiou, A. & Lodefalk, M. (2021). A Literature Review of the Nexus between Migration and Internationalization. Journal of International Trade & Economic Development, 30(3), 319-340.


Similar content

Working Paper no. 328 Wholesale firms: A catalyst for Swedish exports?
Working paperPublication
Daunfeldt, S-O., Engberg, E., Halvarsson, D., Kokko, A. & Tingvall, P.
Publication year

2019

Published in

Ratio Working Paper

Abstract

This paper examines the role of wholesale firms as facilitators of exports for small and medium-sized Swedish businesses. Our findings suggest that wholesale firms do facilitate access to difficult markets located outside Europe. For exports of a particular good to a given market, we observe a positive correlation between the export volumes of wholesale and manufacturing firms. Finally, we present evidence that supports a prediction from recent trade models with differentiated firms, namely that wholesale firms can facilitate exports for firms that are not themselves capable of direct exports.

Scandinavia: Refugees at work
Book chapterPublication
Joyce, P.
Publication year

2019

Published in
Abstract

Germany was the top destination country by far for refugees arriving in the years between 2014 and 2017. But much-smaller Sweden received more asylum applications in relation to its population. The other two Scandinavian countries – Norway and Denmark – also saw significant numbers of asylum seekers in relation to their small populations. Since then, Scandinavian countries have turned to the sizable task of integrating new arrivals into the labour market. Refugees have struggled to find work in the Scandinavian countries. Figure 1 shows the employment rate (per cent) among adult refugees in Sweden, Denmark and Norway by years after arrival in the host country. As shown in Figure 1 only between 20 and 35 per cent of male refugees are working two years after arrival. The share in work increases with each year after arrival but employment generally plateaus after ten to fifteen years, significantly below the employment rate among the overall population. Female refugees need more time than males to find work. They usually have less schooling than their male counterparts and often bear children after arrival.48 Employment among female refugees picks up after some time though.

Refugees have long faced several barriers to finding work in Scandinavia, including lower average levels of education than the domestic workforce, lack of host-country language skills, a limited professional network and discrimination.49 These challenges, combined with the large number of arrivals in 2015–16, increased the willingness of Scandinavian governments to promote faster tracks to employment. In Denmark large reforms of integration policies were introduced in 2016. This led to substantial improvements in labour market outcomes.

Migration and Servicification: Do Immigrant Employees Spur Firm Exports of Services?
Article (in press)Publication
Lodefalk, M. & Hatzigeorgiou, A.
Publication year

2019

Published in
Abstract

Services play an increasingly important role in production, employment and international trade but are subject to substantially higher trade costs relative to manufactured goods. Knowledge of how these trade costs can be mitigated is important for facilitating trade of services. In this paper, we analyze the role of immigrant employees as facilitators of firm exports of services, a role that remains largely unexamined. We bridge the gap in existing research by drawing on new data for nearly 30,000 Swedish firms during the period 1998‐2007 within a heterogeneous firm framework. The results have important policy implications. As the multilateral approach to facilitating trade is challenged and more countries are imposing measures to restrict the cross‐country mobility of people, policymakers may need to find new ways to promote exports of services. Our results indicate that immigrant employees spur firms’ export of services activities: hiring one additional foreign‐born worker can increase services exports by approximately 2.5 percent, on average, with a stronger effect found for skilled and newly arrived immigrants. Therefore, policymakers could leverage the findings of this study to implement initiatives that utilize high‐skilled immigrants to promote services exports.

Show more