GLOBAL SMOKESTACK CHASING - A COMPARISON OF THE STATE-LEVEL DETERMINANTS OF FOREIGN AND DOMESTIC MANUFACTURING INVESTMENT

As more domestic manufacturers have fallen prey to global competition, the American stares have been forced to broaden their targets of ''sm okestack chasing'' to include not just U.S. manufacturers but also the ir successful foreign counterparts. However, this two-pranged developm ent strategy is plagued by several dilemmas: 1) the possibility that d omestic and foreign manufacturers may use different locational criteri a; 2) nativistic opposition to foreign employers; and 3) the fact that states' financial resources and business policies may be too meager t o influence corporate investment decisions. Drawing on Gordon, Edwards . and Reich's (1982) social structures of accumulation framework, this paper argues that these dilemmas are symptomatic of a more general pr oblem of the ''shrinking state'' associated with the latest phase of U .S. capitalist development. Results of a pooled, cross-sectional, rime -series analysis of manufacturing investment across the 48 contiguous stares between 1978 and 1985 also confirm that foreign firms are indee d less sensitive to the presence of unions than domestic firms, are vu lnerable to economic nationalist apposition during gubernatorial elect ion years, and that most state-sponsored economic development policies have no positive impact on either foreign or domestic manufacturing i nvestment.