The purpose of this paper is to develop and test theory regarding a geographic halo effect, whereby foreign investors draw overly broad impressions about a country based on high levels of violent crime in specific locations impacting foreign direct investment (FDI) across the country.
The authors analyze the impact of homicides on FDI by source country into Mexican states from 2001 to 2015. They estimate fixed effect and dynamic panel models controlling for several determ…
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