The Effect of Export Promotion Programs on Establishing Export Markets
Abstract
There is a pattern of growth throughout agribusiness in North Dakota in which agricultural products ranging from commodities to machinery have all seen growth since 2000. Exports have contributed to most of this production increase. Agribusinesses across North Dakota are exporting to many areas of the world. With the help of the North Dakota Trade Organization (NDTO) many companies have developed trading relationships with clients in other nations. The purpose of this research is to measure the value of NDTO export promotion on North Dakota agribusiness [through the use of marketing, export programs, and counseling]. If the data supports the use of the NDTO, firms may be encouraged to use the services provided by the NDTO when export issues arise. This thesis uses a Tobit left censored model to bring the data together to produce empirical results which can be associated with the NDTO and its impact on a firm's total exports. Firm-level export promotion was found to be insignificant. However, small and
medium firms were shown to benefit from the use of the NDTO through an average increase in 2008 export revenue of about $16,095 and $269,317, respectively. Furthermore, this is a $6.44 and a $107.73 return on dollar investment for small and medium firms investing in the services of the NDTO, respectively.