Trade Shows, Trade Missions and State Governments: Increasing FDI and High-Tech Exports
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Shows,
Trade
Governments:
Missions
State
and FDI
Increasing
High-Tech
and
Exports
Timothy J. Wilkinson* UNIVERSITY OF AKRON
LanceEliot Brouthers** UNIVERSITY OF TEXAS AT SAN ANTONIO
In this paper we propose that states which attract comparatively more FDI should concentrate on activities designed to draw additional foreign investment rather than on activities designed to promote exports. Results INTRODUCTION
The vehicle through which international business activities are promoted is similar in every state; each sponsors an export promotion organization (EPO) to foster exports and attract foreign direct investment. Although a substantial commitment has been made by state governments to promote exports and increase incoming FDI, there is little research that evaluates these organizations or their services. Are state governments pursuing policies that help to increase exports and attract foreign direct investment? Pre-
indicate that states with comparatively more FDI have greatersuccess in their use of trade missions for the purpose of inwardFDIattractionand in their use of tradeshows to promote high-tech exports. vious studies indicate that some promotional activities may help small to medium sized firms become more effective exporters, particularly those companies that are in the earlier stages of export involvement. The literature points to trade shows and trade missions as two of the more effective programs undertaken by state governments (Seringhaus and Rosson 1989; NASDA 1994)1. In this paper we suggest that states which attract comparatively more foreign direct investment should concentrate their efforts on activities which draw additional FDI.
*Timothy J. Wilkinson ( Ph.D., University of Utah) is an assistant professor of International Business and Marketing in the Department of Marketing at the University of Akron. **Lance Eliot Brouthers (Ph.D., University of Florida; Ph.D., Florida State University) is an associate professor in the Division of Management and Marketing at the University of Texas at San Antonio. The authors are indebted to the anonymous reviewers for their high quality comments on earlier versions of this paper. JOURNAL OF INTERNATIONALBUSINESS STUDIES, 31, 4 (FOURTH QUARTER
2000): 725-734
725
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TRADE PROMOTIONAND STATE GOVERNMENT
Which States Should Focus on FDI Attraction?' The recognition that foreign direct investment favors particular states is of importance to policy makers because for many years investment attraction was the primary development activity of state governments (Eisinger 1988). FDI attraction programs have consisted of luring industry through a variety of tax breaks, debt financing, and appealing labor and regulatory policies. In addition, state governments have made aggressive use of trade missions for the purpose of attracting foreign investment (O'Neill 1990). This activity appears to play the mo
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