An Evaluation of State Sponsored
Promotion Programs
Timothy J. Wilkinson
UNIVERSITY OF AKRON
Lance Eliot Brouthers
UNIVERSITY OF TEXAS AT SAN ANTONIO
In this analysis, we test hypotheses concerning the effectiveness of govern-
ment export promotion programs on firm export success by examining
the relationships between program offerings and state exports. We find
that: (1) trade shows are positively related to direct exports, (2) trade
missions are negatively associated with high-tech growth exports, (3)
foreign offices are not associated with exports, and (4) objective market
information programs, such as computer-generated trade leads, are nega-
tively associated with direct exports. Implications for business are offered
as are directions for future research efforts. J BUSN RES 2000. 47.229–
236.  1999 Elsevier Science Inc.
C an firms increase international sales by utilizing spe-
cific state government export promotion programs?
Previous research indicates that certain state programs
appear to help firms become successful exporters (Cavusgil and
Naor, 1987; Coughlin and Cartwright, 1987; Pointon, 1978;
Seringhaus and Rosson, 1989, 1991). For example, trade
shows are viewed positively by firms with little previous
involvement in exporting because they help firms rapidly
acquire information about potential markets (Olson, 1975;
Reid, 1984; Denis and Depelteau, 1985). Other programs, how-
ever, such as trade lead matching of the identification of foreign
agents, are viewed with skepticism and are considered to be of
little practical value (Walters, 1983; Lesch, Eshghi, and Eshghi,
1990; Kedia and Chhakar, 1986).
Previous studies by Seringhaus and Rosson (1989) and
Seringhaus and Rosson (1991) have empirically demonstrated
a link between certain export promotion activities and firm
objectives. However, no previous study has ever attempted
to empirically demonstrate a systematic relationship between
various programs offered by state government export promo-
Address correspondence to Timothy J. Wilkinson, Department of Marketing,
Business Administration Building 306, University of Akron, Akron, OH 44325-
4804.
Journal of Business Research 47, 229–236 (2000)
 1999 Elsevier Science Inc. All rights reserved.
655 Avenue of the Americas, New York, NY 10010
tion organizations (EPOs) and export success. The purpose
of this article is to build on previous efforts to see if a systematic
relationship exists between specific export promotion pro-
grams offered by state governments and actual levels of state
exports.
Building on the work of Seringhaus (1987), Seringhaus and
Rosson (1989, 1991), Kotabe and Czinkota (1992), and others
concerning EPO program effectiveness, we developed hypothe-
ses pertaining to four specific EPO activities, trade shows, trade
missions, foreign offices, and objective market information ac-
tivities: (1) trade shows will be positively related to state exports;
(2) trade missions will be positively related to state exports; (3)
foreign offices will not be positively related to state exports;
and (4) objective market information programs, such as com-
puter-generated trade leads, will not be associated with higher
levels of state exports. We use regression analysis to test each
of our four hypotheses for both direct exports and high-tech
growth exports.
The article proceeds as follows. First, the need for export
promotion programs is discussed. Second, hypotheses are
developed regarding the effectiveness of EPO programs based
on previous literature. Third, the methods used in the study
are described, and the empirical results are presented. The
implications of the findings for firms then are discussed. Fi-
nally, the limitations of the study and future research direc-
tions are explored.
Why Export Promotion?
Exporting firms are more likely to stay in business than are
nonexporting firms, pay 13–18% above average, achieve 20%
faster employment growth, and exhibit greater productivity
than companies that are not marketing their products overseas
(Daley, 1997, p. 7). Despite these potential benefits, relatively
few companies are involved in export markets. In 1992, the
last year in which figures were available, out of 690,000 manu-
ISSN 0148-2963/00/$–see front matter
PII S0148-2963(99)00097-1
230 J Busn Res
2000:47:229–236
facturing firms only 6% were involved in exporting (Daley,
1997, p. 7). Why might this be the case?
Because of the complexity of the international business
environment and the comparative scarcity of resources, several
studies note that small- and medium-sized firms are at a
disadvantage if they decide to compete internationally (Se-
ringhaus and Botschen, 1991; Seringhaus, 1986, 1987; Ra-
maswami and Yang, 1990). The uncertainties of the exporting
enterprise, ignorance about foreign markets, and the daunting
nature of exporting process all militate against such firms
becoming committed exporters (Goodnow and Hansz, 1972;
Weinrauch and Rao, 1974; Bilkey and Tesar, 1977; Czinkota
and Johnson, 1983; Kaynak and Kothari, 1984; Rabino, 1980;
Reid, 1984; Seringhaus and Rosson, 1989). The difficulties
that smaller firms encounter when they become involved in
exporting have been characterized by Seringhaus and Rosson
(1989) as “barriers” or “inhibitors.”
Seringhaus and Rosson (1991, p. 55) suggest that state
EPOs can aid smaller firms in overcoming export barriers as
they enter and expand into foreign markets. Dominguez and
Cirigliano (1997, p. 35) argue that such assistance is vital
because “export-oriented policies have proven superior to in-
ward-oriented policies in delivering both long-term economic
growth and quality of life indicators.”
State export promotion programs attempt to address the
problem of export barriers by offering a wide variety of activi-
ties designed to help exporters and potential exporters become
involved in international marketing. In the 1980s, state gov-
ernments began to increase and expand their involvement in
export promotion (Kotabe, 1993). By 1994, the states operated
162 overseas offices in 25 countries and spent an average of
$1,676,702 for the purpose of promoting state exports
(NASDA, 1994, p. 120).
Previous Studies
on Export Promotion
A large body of literature has examined the effectiveness of
export promotion programs. Seringhaus (1986) in a review
of 21 empirical studies found that most of the research that
has been done measures the attitude or perception of managers
toward government programs. The measures used in these
studies usually consist of qualitative responses, producing ordi-
nal or nominal scale values rather than quantitative responses,
such as the number of orders or export sales (Seringhaus,
1986, p. 59). The author concluded that, based on previous
studies, it was not possible to determine whether or not pro-
motional programs actually have any impact on exporting
firms (Seringhaus, 1986, p. 62).
Despite the ambiguity in much of the literature, several
studies have attempted to find an association between EPO
activities and export performance; none has used actual ex-
ports as a dependent variable. For example, Cavusgil and
Naor (1987) conducted an empirical study of 310 firms that
attempted to link a firm’s export status (exporting or nonex-
T. J. Wilkinson and L. E. Brouthers
porting) to 25 firm and management characteristics. Among
the top nine variables linked to export status are “whether or
not firms seek information from executives in other compa-
nies, state agencies, and the U.S. Department of Commerce”
(Cavusgil and Naor, 1987, p. 229). Of these, state agency
information ranks third, and seeking help from the U.S. De-
partment of Commerce ranks seventh. An important limitation
of this study is that specific EPO programs are not examined.
It would be wrong to assume that the absence of studies
on the effectiveness of specific export promotion activities
means that the states have been inactive in this area. Over
the past two decades, a wide variety of export promotion
strategies have been used. The activities explored in this article
are described below.
Trade Shows/Fairs
Trade shows take place at a fixed location overseas. Fairs
consist of multiple booths in a convention hall in which firms
exhibit their products anywhere from two days to two weeks
(Tanner, 1995). Trade shows provide ready-to-export firms
potential customers and contracts (Seringhaus and Rosson,
1989), and are, as a consequence, viewed favorably by manag-
ers (Ramaswami and Yang, 1990, p. 202). Fairs allow potential
exporters to (1) sell products; (2) gain access to decision
makers; (3) disseminate facts about services, products, and
personnel; (4) identify prospects; (5) maintain image in the
industry and with the media; (6) gather intelligence; and (7)
enhance and maintain firm morale (Bonoma, 1983).
Trade shows tend to be viewed positively, especially by
those firms that already are prepared to export (Reid, 1984;
Denis and Depelteau, 1985). Seringhaus and Rosson (1989,
p. 235) found that, given similar levels of effort, participants
in trade shows were more effective in terms of sales than were
trade mission participants. In a subsequent study of 367 firms
that exhibited at 48 international trade fairs between 1984
and 1986, Seringhaus and Rosson (1991) found that only
18% of the firms were able to break even, whereas one exporter
had $30 million in sales. Thus, trade shows, despite great
individual firm variability, are expected to have an overall
positive impact on aggregate levels of state exports. This leads
to our first hypothesis:
H1A: Trade shows are positively associated with state ex-
ports.
Trade Missions
Trade missions are considered to be most appropriate for
non- and new exporters. They function as an on site tutorial,
providing a learning experience which allows firms to acquire
information and expand their knowledge of the exporting
process (Seringhaus, 1987, p. 57). Trade missions allow po-
tential exporters to learn (1) how business is conducted over-
seas, (2) what services and products are available, (3) the
receptivity of potential buyers, (4) the extent of the commit-
State Sponsored Promotion Programs
ment and resources necessary to sell in overseas markets, and
(5) the answers to questions about foreign markets and the
process of exporting (Seringhaus and Rosson, 1989, p. 176).
In an examination of the actual impact of trade missions
on firm objectives, Seringhaus and Rosson (1989) analyze
export performance of 462 firms between 1984 and 1987.
The authors note that while sales are the ultimate goal of
promotional activities, other objectives also may be satisfied.
They found that trade missions were somewhat more effective
on average than trade fairs in fulfilling firm objectives. Of the
10 objectives examined, trade missions were more effective
in introducing new products to the market; maintaining a
market presence; meeting customers, agents, representatives,
and distributors; and in making business contacts. For the
remaining objectives, the authors found no significant differ-
ences between trade missions and trade shows. The authors
found that trade mission participants “generated 2.7 times
the sales of fair participants—an average of $756,000 versus
$279,000, but that trade fairs generated more overall business
due to the larger number of participants” (Seringhaus and
Rosson, 1989, p. 230). Thus, trade missions like trade shows
appear to be positively related to export growth. This leads
to our second hypothesis:
H2: Trade missions are positively associated with state ex-
ports.
Trade Shows/Missions and
High-tech Exports
There is some reason to suspect that trade shows and trade
missions will work particularly well with high-tech growth
exports. A study of 354 small- and medium-sized exporters
located in Florida, found that firm size, choice of market, and
product mix were interrelated in affecting the ability of firms
to export their products (Mahone, 1994). The author states
that “depending upon product mix, opportunities do exist for
small- and medium-sized firms in export markets. However
these appear greater for firms which produce medium- and
high-tech products” (Mahone, 1994, p. 145). Small- to me-
dium-sized manufacturing firms are the targets of state export
promotion efforts. Therefore, it may be that the trade shows
and trade missions will be more effective when they are fo-
cused on high-tech growth exports of small firms.
H1B: Trade shows are positively associated with high-tech
growth exports.
H2B: Trade missions are positively associated with high-
tech growth exports.
Objective Market
Information Activities
In contrast to trade missions and trade shows, objective knowl-
edge-based activities, such as trade lead matching programs,
J Busn Res 231
2000:47:229–236
are not viewed as being particularly effective (Simpson and
Kujawa, 1974; Walters, 1983). This is because firms (1) are
not provided with appropriate information (Lesch, Eshghi,
and Eshghi, 1990); (2) have trouble evaluating available infor-
mation (Walters, 1983, p. 42); (3) are unable or unwilling to
use the information obtained from these programs (Kedia
and Chhakar, 1986); (4) are uninterested in these types of
activities; and (5) prefer other sources of information (Reid,
1984). Thus, for all the above reasons, it appears that objective
knowledge based activities, such as trade lead matching pro-
grams, are ineffective and therefore are unlikely to be positively
related to export growth.
Foreign Offices
One of the most extensive export promotion activities of state
governments is the maintenance of overseas offices. These
offices serve as outposts, establishing contacts and providing
a continual flow of information for their home states. Although
the number of overseas offices declined from a high of 163
in 1990, a total of 137 outposts in foreign countries were
operating in 1994 (NASDA, 1994, p. 13). Seventy-four of
these offices are located in the Pacific Rim with approximately
half that number operating in Europe. Thus, the pattern of
trade offices in many respects follows the world pattern of
trade, with the overwhelming majority of trade offices located
in either developed nations or in the newly industrialized
nations of the Pacific Rim.
Few studies on the effectiveness of foreign offices have been
undertaken. A study by Martin (1996) found no relationship
between exports and the existence of subnational foreign of-
fices in Japan. Instead, the author found that passive forms
of international contact, such as sister city arrangements, were
more closely associated with exports. Similarly, a study by
Kotabe (1993) examining the effect of foreign offices on in-
coming foreign direct investment found no association be-
tween overseas offices and FDI.
Having established, from the literature, a basis on which to
predict which EPO activities will be effective, the methodology
used in the current study is explained.
Data and Methods
The data for the dependent variables used in this study are
drawn from the report, Exports from Manufacturing Establish-
ments, 1990 and 1991 published by the Department of Com-
merce. This survey, the most recent of its type, is used because
its data is more reliable than the other major survey produced
by the Department of Commerce (the Summary of U.S. Export
and Import Merchandise Trade). Exports from Manufacturing
Establishments, 1990 and 1991 includes “estimates of the value
of exports and export-related employment, both for directly
exported goods and for the indirect requirements supporting
manufactured exports” (U.S. Department of Commerce, 1994,
232 J Busn Res
2000:47:229–236
3).1 Because EPOs generally limited their focus to manufactur-
ing enterprises, the models tested here do not examine services
or agricultural products or services.
The first dependent variable, direct exports, consists of the
value of goods that have been shipped overseas. Estimates are
provided by manufacturers on a state-by-state basis at the
two- and three-digit SIC code level. The data are based on
estimates of manufactured goods obtained using a probability
sample of 55,000 manufacturing establishments (U.S. Depart-
ment Of Commerce, 1994, p. A-1).2 This survey also was used
to construct the second dependent variable, high-tech growth
exports.
Information regarding the independent variables comes
from the State Export Promotion Data Base (NASDA, 1990).
The data were collected through an extensive survey distrib-
uted to EPOs in all 50 states in 1990. The following statement,
which is the only information provided regarding how the
survey was conducted, appears under the section of the survey
entitled methodology:
NASDA surveyed the 50 United States and two territories
(the U.S. Virgin Islands and Puerto Rico, both members
of NASDA) in July 1990 on many aspects of their trade
development programs. Responses were collected between
July and December 1990. The results of that survey are the
basis for the NASDA 1990 State Export Program Database.
(NASDA, 1990)
NASDA received a 100% response, presumably because it is
a high profile agency that works with EPOs on an ongoing
basis. The data gathered cover almost all aspects of export
promotion activities. The independent variables consist of
the number of trade missions, trade shows, foreign offices,
objective market information activities and state population.
Details concerning the independent and dependent measures
are enumerated in Appendix A.
Method of Analysis
Pooling data into multiple year averages provides more reliable
and valid measures and helps to stabilize the effects of single-
year variations and variance in the overall sample (Gomez-
Mejia, Tosi, and Hinkin, 1987; Zajac, 1990). Two-year aver-
1
Alaska and Hawaii are not analyzed in this article because of the distortive
effects of comparatively high exports resulting from their geographical loca-
tions.
2
The lack of more recent export data necessitates the use of continuous
data for the dependent and independent variables, thereby disallowing an
examination of any lag structure that may be present. This is mitigated
somewhat by including exports employment from 1991 in the model. In
addition cross-sectional analyses of this type makes the realistic assumption
that there is a fairly high level of consistency in public policies from year
to year. It also assumes that the change that does occur is incremental in
nature (Lindblom, 1959).
T. J. Wilkinson and L. E. Brouthers
ages of all exports as measured in dollars are used. Although
a four-or-five-year average would be preferable, this will not
be possible because in 1990, “the Census Bureau began using
its own concordance to allocate the Harmonized System
Schedule B export commodity codes to a Standard Industrial
Classification commodity basis” (U.S. Department Of Com-
merce, 1994, p. 8). Therefore, the validity of using prior
surveys in this manner is questionable.
Findings
Table 1 reports the means, standard deviations, and correla-
tions of all of the variables in the regression equations. It
shows that with the exception of population and trade shows,
there is no evidence of multicollinearity problems between
the independent variables. Trade show and population has a
comparatively high correlation coefficient of 0.75. However,
collinearity diagnostics reveals a variance inflation factor (VIF)
of 2.87 for trade shows and 2.53 for population. Studenmund
states, “a common rule of thumb is that if VIF(b) . 5, the
multicollinearity is severe” (Studenmund, 1992, p. 275). Both
of these are well below this number.
Table 2 displays the unstandardized coefficients, standard
errors, and significance of the two regression models in which
direct exports (model 1) and high-tech growth exports (model
2; both measured in dollars) are the dependent variables,
and the four export promotion activities (trade shows, trade
missions, foreign offices, and number of objective market
information activities) and state population are the indepen-
dent variables. Relatively high goodness-of-fit statistics for the
export models suggests that population is a good proxy for
the economic activity and export capacity of the states.
Export Promotion Activities
and Direct Exports
In the regression equation for model 1, trade shows (t 5 1.89,
p < 0.05), objective market information activities (t 5 1.83,
p < 0.05), and population (t 5 7.50, p < 0.05) are significant,
whereas trade missions (t 5 1.36) and foreign offices (t 5
0.19) are not statistically significant. The last of these is consis-
tent with the prediction that foreign offices would not be
positively associated with state exports.
An unstandardized coefficient of 308.78 indicates that
each trade show is associated with an average increase of
$308,780,000 in direct exports. Or, given the limitations
of cross-sectional analysis, it is more precise to say that
$308,780,000 in direct exports is the difference in direct
exports per unit increase in trade shows (McClendon, 1994,
p. 40). In addition, with a beta of 0.20, trade shows account
for more variation in direct exports across states for the years
under consideration than do any of the other program vari-
ables. These findings support our first hypothesis, which states
that trade shows are positively associated with state exports. In
State Sponsored Promotion Programs J Busn Res 233
2000:47:229–236

Table 1. Correlation Matrix of Exports and Independent Variables

Market
Direct Trade Trade Foreign Information
Exports Shows Missions Offices Activities Population

Mean 6284.12 6.23 2.60 3.25 6.38 5134.25

Standard deviation 7470.77 5.06 2.20 2.46 2.13 5506.11
Direct exports 1.00 0.71a 0.20 0.40a 0.07 0.88a
Trade shows 0.72a 1.00 0.35a 0.47a 0.25b 0.75a
Trade missions 0.02 0.35a 1.00 0.11 0.34a 0.12
Foreign offices 0.40a 0.47a 0.11 1.00 0.35a 0.46a
Market information activities 0.08 0.25b 0.34a 0.35a 1.00 0.26
Population 0.88a 0.75a 0.12 0.46 0.26 1.00

a
p < 0.05, two-tailed test.
b
p . 0.05, p , 0.10, two-tailed test.

contrast, the second hypothesis, trade missions are positively
associated with state exports, is not supported (t 5 21.36).
An unstandardized coefficient of 2479.14 for objective
market information activities indicates that $479,140,000 in
direct exports is the difference in direct exports per unit de-
crease in objective market information activities. The beta
for this variable, at 20.14, is smaller than the standardized
coefficient for trade shows. This finding is consistent with the
prediction that objective market information activities would
not be positively associated with state exports.
Export Promotion Activities
and High-Tech Exports
In the regression equation for model 2, high-tech growth
exports, trade shows (t 5 2.84, p < 0.05), trade missions
(t 5 22.76, p < 0.05), and population (t 5 7.47, p <
0.05) are statistically significant. Objective market information
activities (t 5 0.29) and foreign offices (t 5 0.23) are not
statistically significant. An unstandardized coefficient of 189.00
indicates that each trade show is associated with an average
of $189,000,000 in high-tech growth exports. A standardized
regression coefficient of 0.30 indicates that the relationship
between these two variables is stronger than any of the other
program variables. This confirms hypothesis 1B, trade shows
are positively associated with high-tech growth exports. For the
trade mission variable, $306,850,000 in high-tech growth
exports is the difference in growth exports per unit decrease
in trade missions. The beta is 20.21. The findings do not
support hypothesis H2B, which states, trade missions are posi-
tively associated with high-tech growth exports.
Discussion and Implications
We began this article by hypothesizing empirical linkages
between various programs offered by state government export
promotion organizations and actual levels of state exports.
Based on the previous literature on EPO program effectiveness,
we developed hypotheses concerning four specific EPO activi-
ties, trade shows, trade missions, foreign offices, and objective

Table 2. The Effect of Export Promotion Activities on Direct Exports and High-Tech Growth Exports
Model 2
Model 1 High-Tech
Direct Exports Growth Exports

Variables Unstandardized regressions coefficients Unstandardized regressions coefficients

(standard error) (standard error)
Shows 308.78a (163.00) 189.00a (66.45)
Missions 2353.12b (260.00) 2306.49a (110.73)
Foreign offices 228.21 (238.58) 2119.20 (99.63)
Objective market information activities 2479.14a (261.48) 30.71 (106.19)
Population 1.06a (0.14) 0.429a (0.06)
Constant 3003.60 (1561.94) 2819.99 (646.42)
R2 0.82 0.86
Adjusted R2 0.79 0.84
F 38.56 43.00
N 47 41

a
p < 0.05, one-tailed test.
b
p . 0.05, p , 0.10, one-tailed test.
234 J Busn Res
2000:47:229–236
market information activities: (1) trade shows will be posi-
tively related to state exports; (2) trade missions will be posi-
tively related to state exports; (3) foreign offices will not be
positively related to state exports; and (4) objective informa-
tion programs, such as computer-generated trade leads, will
not be associated with higher levels of state exports. We used
regression analysis to test each of our hypotheses for both
direct exports and high-tech growth exports.
We found that trade shows were positively associated with
direct exports and high-tech growth exports. In contrast, ob-
jective market information activities were negatively related
to direct exports and trade missions were negatively associated
with high-tech growth exports. In particular, our results con-
cerning trade missions appears to contradict hypothesis 2,
which was based on an earlier finding of Seringhaus and Rosson
(1989). They found a positive relationship between firms going
on trade missions and increases in the firm’s exports. We
suggest that this apparent contradiction can be reconciled as
follows. Although Seringhaus and Rosson (1989) found a
positive relationship between trade missions and exports on
a per firm basis, they also found that trade shows yielded
substantially higher levels of total exports than trade missions
due to the much larger number of firms that participate. We
suggest that since our study deals with aggregate levels of
exports our results reflect the relatively greater effectiveness
of trade shows at the aggregate level.
Does this mean that state investments in trade missions
and/or objective market information activities actually reduce
state export levels? When attempting to understand what the
negative relationships between trade missions, objective mar-
ket information activities and exports actually mean it is im-
portant to remember that our cross sectional analysis mea-
sured variation across states rather than a casual relationship
measured over time. Thus, it would be incorrect to conclude,
for example, that each trade mission undertaken results in a
loss of $306,490,000 in high-tech growth exports. What it
actually means is that states that had more trade missions had
lower levels of exports than states that had more trade mis-
sions. Why might this be the case? One possibility is that
stage governments are constrained by resource limitations.
funds must be allocated among various EPO programs. In-
vesting in a trade mission may not mean not investing in a
trade show, etc. Since our findings appear to indicate that
trade shows yield the best results, any diversion of state funds
away from trade shows may lead to suboptimal levels of state
exports. Thus, the negative associations between exports and
trade missions and objective market information activities may
be interpreted as opportunity costs.
Our findings have two specific implications for firms. The
first, related to the statements above, suggests that trade mis-
sions may not be a productive activity for many businesses.
Earlier literature suggests that trade missions are the most
appropriate activity for firms in the early stages of exporting
(Seringhaus, 1987; Seringhaus and Rosson, 1989) and that
they are viewed positively by exporters and potential expor-
T. J. Wilkinson and L. E. Brouthers
ters (Katcher, 1975; Cavusgil, 1983; Seringhaus, 1987; Elvey,
1990). The negative relationship between trade missions and
exports found in this study indicate that whereas this may be
the case in an ideal or theoretical sense, in practice, trade
missions are being used for different purposes. Kotabe (1993)
suggests that trade missions are not used to increase exports,
but rather are used by government officials to encourage for-
eign business to relocate to their states. Future research could
examine the association between state sponsored trade mis-
sions and foreign direct investment.
Second, the positive relationship between trade shows and
exports suggests that participation in trade shows can be a
useful and profitable activity for firms. Businesses, particularly
those just becoming involved in international markets, can
benefit not only from knowledge gained through hands on
experience but from actually selling their products. In general,
the findings suggest that domestic firms should attempt to
persuade state governments to increase the number of trade
shows that they undertake.
Limitations and
Future Research Directions
There are a number of empirical limitations to this study.
First, the study is a test of the aggregate effects of state govern-
ments’ EPO strategies on exports. As such it suffers from
the usual shortcomings of aggregate tests and secondary data
analysis. Future research efforts might focus more directly on
the differing motives and behaviors of individual firms with
respect to program offerings and the impacts of those on the
specific firm’s exporting efforts. Second, because our study is
cross-sectioned, the longitudinal effects of these programs
remain unexplored. It may turn out that our predictions do
not hold over the long run. Third, although we note an associa-
tion at the industry level between selected EPO activities and
high-tech industries, future efforts may wish to focus (1) on
firms rather than on industries and (2) on a wide range of
industries.
Exporting can be a profitable way for firms to expand their
markets. State-based export promotion offices exist to help
firms in this effort. By using EPOs to create or expand interna-
tional sales, firms can externalize some of their global market-
ing efforts at very little cost. Particularly for small- and medium-
sized resource-constrained companies that wish to expand over-
seas, the information and services that EPOs provide can be
valuable. The challenge for future research is to determine
under what conditions EPO programs provide the greatest
benefits to firms seeking to expand their exporting efforts.
Appendix A
Dependent Variables
Two categories of dependent variables were tested in this
article—direct exports and high-tech growth exports. Both
are measured in dollar terms.
State Sponsored Promotion Programs
Direct exports includes only the value of manufactured
products exported by producing plants.
High-tech growth exports are based on a classification scheme
developed by Markusen, Hall, and Glasmeier (1986). High-
tech growth exports includes rapid and modest growth sectors.
These are (Rapid) electronic components and assembly, office
computing machines, communications equipment, and medi-
cal and dental supplies; (Modest) photographic equipment,
drugs, construction equipment, soap, general industrial ma-
chinery, industrial organic chemicals, and engines and tur-
bines.
Independent Variables
Trade shows consist of multiple booths in a convention hall
in which firms exhibit their products anywhere for up to two
weeks (Tanner, 1995).
Trade missions are led by high-level EPO officials who ar-
range meetings between buyers and sellers at overseas loca-
tions (Jaramillo,1992, p. 31). They allow participants to gain
first-hand knowledge of the potential market as well as an
opportunity to assess the commitment and resources that are
necessary to be successful in a particular market.
Objective Market Information Activities consist of the fol-
lowing dummy variables (yes 5 1; no 5 0): trade lead pro-
gram 1 matchmaker program 1 foreign buyers program 1
identify agents and distributors 1 publish product descrip-
tions abroad 1 market studies prepared by state staffs 1
market studies by overseas office staff 1 market studies out-
sourced 1 electronic trade lead system 1 market studies/
research done by industry sector.
State population, the final independent variable, is included
as a proxy for the economic variation that exists between states.
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