The empirical literature has generally focused on the impact of trade openness on FDI. One would, however, expect capital account openness to also affect FDI. For example, restrictions on currency convertibility, such as foreign exchange control laws, are likely to deter FDI. This is particularly true for market-seeking FDI since such laws makes it difficult for foreign firms to repatriate their profits. Unlike trade openness, data for variables that measure capital account openness are not readily avail- able. Hence, I am unable to analyze the empirical link between current account openness and FDI.