National Competitiveness: A Question of Cost Conditions or Institutional Circumstances?

Abstract

The issue of national competitiveness is a matter of considerable importance to both managers and public policy makers alike. Business scholars reflect this importance by their annual production of international indices of country competitiveness. Nevertheless, the notion of national competitiveness is controversial and has both (i) a narrow, concise conception that relates primarily to cost conditions as determined by exchange rates, and (ii) a broader, more nebulous conception that comprises the institutional and systemic circumstances of an economy, such as legal, governmental, public policy and other factors framing countries' wider business environments. In practical managerial terms, national competitiveness is a combination of both these narrow and broad conceptions. However, exactly how important cost conditions as opposed to institutional circumstances are to national competitiveness from a practical business perspective has never been investigated and is not known. This study uses qualitative and quantitative data gathered from senior firm executives in a specimen economy to find out. Hierarchical regression analyses suggest that institutional circumstances are significantly more important than cost conditions to the competitiveness of an economy from a practical managerial viewpoint.

Proceedings. International Scientific Conference "Local Economic and Infrastructure Development of SEE in the Context of EU Accession", September 20-21, 2013

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Quality management concept and competitiveness of Serbian companies

“…Specialist literature provides various definitions concerning competitiveness of national economies, (Porter, 1990;Thompson, 2003Thompson, , 2004. As regards to international competitiveness, it is also referred to a wider notion -competitive capacity, which is evaluation of development potential of a country or enterprise and it does not only refer to real perspective but rather to subjective one, i.e.…”

The causal impact of material productivity on macroeconomic competitiveness in the European Union

“…This approach essentially claims that only firms compete with each other, but the country's environment is an important factor for firms' success. In short, microeconomic and macroeconomic factors combined determine competitiveness (Thompson 2004). Porter (1990) calls these the ''diamond of national competitiveness'', which comprises interrelated factors that together explain macroeconomic competitiveness.…”