Foreign direct investment (FDI) flows to the Caribbean play a critical role
in relation to growth and development. This paper provides evidence about
the nature and pattern of CARICOM FDI flows. A Gravity model,
estimated using the Hausman-Taylor procedure for panel data, is used to
explain such flows between a selection of CARICOM and OECD
countries. Income in both the host and destination countries play a
significant role in FDI flows, as do the level of financial development and