Inward Foreign Direct Investment and U.S. Public Opinion on Immigration

Abstract

I investigate how the direct investment of foreign firms in the United States affects public opinion on immigration. On one hand, when foreign firms invest in the United States, local residents may have job opportunities and a better understanding of foreign cultures following social and work-related interactions with foreign employees at multinationals. As a result, American workers may have a positive attitude toward immigration. On the other hand, when local residents see foreign investment as a foreign acquisition of American assets, or if they experience any unpleasant interactions with foreign nationals at multinationals, foreign investment may result in a negative impact on public perception on immigration. My empirical test of inward investment’s impact on public opinion demonstrates the aforementioned contrasting impacts: While more local employees working at foreign multinationals lead to positive sentiments on immigration, the existence of more local affiliates of foreign firms has a negative impact on public opinion of immigration.