About National Competitiveness

Competitiveness is the ability of a nation to create sustainable value through its enterprises and to maintain a high standard of living for its citizens. Competitiveness is primarily driven by productivity – the level of output per input used, including labor and capital goods.

Nations compete with each other by offering the most productive labor force and the most conducive environment for business. This environment in turn attracts investment, allows existing companies to grow, and leads to job creation. High levels of productivity, however, require greater investment and focused choices on differentiated activities rather than simply competing on price or low wages.

Macroeconomic, social, political and legal policies create the potential for greater company productivity and prosperity by providing access to capital and foreign markets. However, actual wealth generation takes place at a microeconomic level through the creation of unique and innovative goods and services that can demand high prices on the world market. Wealth can be inherited, but ultimately it needs to be created to achieve sustainable prosperity. For this reason, competing on cost/low wages or on abundance of natural resources is not a basis for sustainable competitive advantage.

Diamond Framework

Stages of Economic Development

How Competitiveness is Assessed