Competition for Port-Related Trade: The Role of State and Local Governments in the U.S.

International trade has long been considered an important resource for local economic development in the United Stats (US). Local and state governments generally see ports as valued regional economic resources, and they have many policy tools to attract port-related trade, from favorable tax policies to infrastructure investment to direct subsidies. However, port-related trade also generates externalities that may affect local public support. Thus local and state governments may be faced with both promoting trade and addressing local concerns. At the same time, governance structures in the US have become more fragmented and decentralized, making it more difficult to manage such competing concerns. This paper examines programs to reduce landside congestion at two US west coast port complexes, Los Angeles-Long Beach and Seattle-Tacoma. The programs focused on grade separations to reduce conflicts between rail and highway traffic. Differences in outcomes are explained by both institutional and contextual factors. The ability to effectively address local externalities is emerging as a major factor in port competition on the US west coast.