Attracting foreign manufacturing: Investment promotion and agglomeration

We study Japanese investments between 1980 and 1992 to assess the effectiveness of US state promotion efforts in light of strong agglomeration effects in Japanese investment. The provision of foreign trade zones, lower taxes, and job-creation subsidies have statistically significant effects on the l...

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Bibliographic Details
Published inRegional science and urban economics Vol. 29; no. 2; pp. 197 - 218
Main Authors Head, C.Keith, Ries, John C., Swenson, Deborah L.
Format Journal Article
LanguageEnglish
Published Amsterdam Elsevier B.V 01.03.1999
Elsevier
North-Holland
Elsevier Sequoia S.A
SeriesRegional Science and Urban Economics
Subjects
Agglomeration
Demand functions
ECONOMIC MEASURES
Empirical research
Foreign direct investment
Foreign investment
Foreign Investments
Foreign trade
Incentives
INVESTMENT
Investment promotion
Japan
Manufacturing
Simulation
State Government
Studies
Trade promotion
United States
United States > US
Japan
Incentives
H32
R38
Foreign direct investment
Agglomeration
H2
F2
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Summary:We study Japanese investments between 1980 and 1992 to assess the effectiveness of US state promotion efforts in light of strong agglomeration effects in Japanese investment. The provision of foreign trade zones, lower taxes, and job-creation subsidies have statistically significant effects on the location of investment. Simulations indicate that unilateral withdrawal of promotion would have caused individual states to lose substantial amounts of Japanese investment. However, because state promotional policies tended to offset each other, their impact on the geographic distribution of Japanese investment appears small.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
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ISSN:0166-0462
1879-2308
DOI:10.1016/S0166-0462(98)00029-5