From 1997 to 2006, US state governors led more than 500 trade missions to foreign countries. Trade missions are potentially a form of public investment in export promotion. I create a theory of public investment by introducing government to a Melitz (2003)–Chaney (2008) model. Controlling for...

From 1997-2006, U.S. state governors led more than ve hundred trade missions to foreign countries. Trade missions are potentially a form of public investment in export promotion. I create a theory of public investment by introducing government to a Melitz (2003)-Chaney (2008) trade model....

Forty U.S. states operated an overseas office in 2002. Treating overseas offices as sales offices, I modify Holmes (2005) so oces facilitate exports by reducing the transaction cost of selling abroad. From theory, states operate an office if aggregate savings outweigh operating costs. Exploiting...