| Abstract: | Estimating the impact of state import promotion programs on exports is difficult because of a simultaneity program. The 2003 California budget crisis provides a natural experiment allowing for an unbiased estimate. Due to the crisis, California closed all 12 overseas offices on 1 January 2004. Applying the differences‐in‐differences estimator to a sample of 44 countries over eight years yields an estimated 2%–3% increase in exports if the offices remained open. But this estimate is not statistically significant. Therefore, I find no statistical evidence that California's overseas offices increased exports. (JEL F13, H76, O24) |
