Do foreign investors behave differently if they belong to the diaspora of the country in which they are investing?
Cristopher Patvakanian ’20, an Economics concentrator with a secondary field in Government, set out to explore how such a scenario plays out in Armenia. He was recently awarded a Thomas Temple Hoopes Prize for his thesis, “The Ethnic Connection: Armenian Diaspora Investment."
“The primary goal of my thesis,” Patvakanian explained, “is to understand whether or not the ethnic connections of diaspora Armenians make them more considerate and conscientious firm owners or managers than non-diasporan investors.”
“I choose this topic because as a diasporan myself, I've always known that diasporans created businesses in the country,” says Patvakanian, “but I was never really able to understand how prevalent or impactful those investments were.
The lack of available data on his chosen topic surprised him. Gathering the necessary information for quantitative analysis would prove difficult: “It was very different from the standard online download of a nicely formatted spreadsheet!”
Having completed an internship at the Central Bank of Armenia in 2018, Patvakanian returned this past winter to conduct a survey and gather firm-level data with a team of students at the American University of Armenia.
"It was kind of a funny sight because everywhere there were signs around the Student Union Lounge saying 'No phone calls!' and 'Keep quiet!' but all ten of us were spread across the room exclusively speaking on the phone and trying our best to persuade business owners and managers to spare us five minutes," says Patvakanian.
"It was a big effort to coordinate who would call which business, follow up with owners who agreed to answer the survey, and also check in with the team daily on any issues or trends with the survey that we might need to alter."
For inspiration and support, Patvakanian cites several sources. "My family, who have always encouraged me to take interest in our heritage and roots, really inspired me in the first place to even think about researching Armenia." He credits his thesis advisors, Professor Jeffry Frieden and Dr. Lisa Gulesserian, with turning this curiosity into a serious academic endeavor.
Former Davis Center Visiting Fellow Araxe Manucharian and Vahe Movsisyan, both of the Central Bank of Armenia, generously helped translate letters, find data sources, and create a survey sample.
Ultimately, Patvakanian found that large firms owned and managed by diasporan Armenians are, in fact, more sensitive to local conditions than non-diasporan foreign firms.
"I am really passionate about both economics and political science, and also Armenia," says Patvakanian. "I've always felt that I should use my time at Harvard working on what I find interesting and what I am passionate about, and for my thesis in economics I was able to merge all three of those passions into one."