The effects of foreign capital on state economic growth

Megan A. Torau, Ernest Goss

Research output: Contribution to journalArticlepeer-review

6 Scopus citations


U.S. Bureau of Economic Analysis data show that the nation's rate yearly output growth between 1995 and 1999 was more than 50% higher than for the period 1987 to 1994. Using state-level data, this study examines foreign capital's contribution to this upturn in growth. Pooling data for the 50 states in a regression framework showed that foreign capital accounted for 2.6% of overall state output growth for the full period. Foreign capital made no contribution between 1987 and 1994 but accounted for 3.7% output growth between 1995 and 1999. Furthermore, estimates show that foriegn capital had a much larger impact on the manufacturing sector accounting for more than 16.7% state manufacturing output growth between 1995 and 1999.

Original languageEnglish (US)
Pages (from-to)255-268
Number of pages14
JournalEconomic Development Quarterly
Issue number3
StatePublished - Aug 2004

All Science Journal Classification (ASJC) codes

  • Development
  • Economics and Econometrics
  • Urban Studies


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