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Minnesota's Performance in Attracting Foregn Direct Investment.

Kudrle, Robert T.

During the 1980s, nearly every state in the nation was engaged in efforts to increase international business development by encouraging foreign direct investment in their state's economy. This article reports on a study of how Minnesota faired during the foreign investment rush of the 1980s compared with the other 48 states in the continental United States. The study compared Minnesota's performance in eight different economic sectors (manufacturing, wholesale, retail, finance, insurance, real estate, services, and other industries) with respect to six independent variables: gross state product (GSP), the rate of growth in GSP, the economic structure of the state, the state's distance from a major coastline, the level of trade union membership in the state, and the state's distance from the nation's manufacturing belt. Based on this analysis, Minnesota attracted more foreign direct investment than expected in only two sectors: real estate and other industries. The author concludes that the state should take an indirect approach to encouraging foreign investment by establishing a generally favorable climate for the attraction, retention, and growth of desirable economic activities, with the expectation that this will contribute to a moderate increase in foreign investment.

CURA Reporter
Publication date: 
Minneapolis: Center for Urban and Regional Affairs, University of Minnesota.
31 (3): 12-18
Online availability
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CURA call number: 
Reporter 31 (3)