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Vol. 83, No. 1
Posted 2001-01-01

Comparing Manufacturing Export Growth Across States: What Accounts for the Differences?

by Cletus C. Coughlin and Patricia S. Pollard

The expansion of United States manufacturing exports has spread unevenly across states. Cletus C. Coughlin and Patricia S. Pollard use shift-share analysis to account for the difference between a state’s manufacturing export growth and national manufacturing export growth between 1988 and 1998. Three effects are examined. The industry mix effect indicates that a state should have experienced export growth above the national average if its exports were relatively more concentrated in industries whose exports expanded faster than the national average. The destination effect indicates that a state should have experienced export growth above the national average it if its exports were concentrated in foreign markets whose purchases from the United States expanded faster than the national increase in exports. The competitive effect is what remains after accounting for these two effects. Coughlin and Pollard find that the competitive effect, which in previous research was related to increases in human capital per worker, is the key determinant of a state’s relative export performance. Furthermore, the industry mix and destination effects, which are of similar importance, are generally dominated by the competitive effect in accounting for a state’s relative export performance.







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