Sudeshna Bandyopadhyay|Todd Sandler|Javed Younas
Foreign direct investment, aid, and terrorism
Federal Reserve Bank of St. Louis|The University of Texas at Dallas|American University of Sharjah
paper constructs theoretical model investigate relationship two major forms terrorism foreign direct investment fdi analyze various estimators relationships affected foreign aid flows focusing 78 developing countries 19842008 types terrorism found depress fdi aggregate aid mitigates negative consequences domestic transnational terrorism aid appears robust ameliorating adverse effect domestic terrorism however aid subdivided bilateral aid effective reducing adverse effects transnational terrorism fdi whereas multilateral aid effective curbing adverse effects domestic terrorism fdi transnational terrorism evidence literature donor countries earmark bilateral aid counterterrorism aids ability curb risk fdi terrorism important fdi important engine development