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Competitiveness. Its Advantages and Disadvantages. Introduction The world
economy has entered an era of total competition. Traditional ...
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Submitted by marzac on April 16, 2007
Category: Business
Words: 6649 | Pages: 27
Views: 902
Popularity Rank: 6,680
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Introduction
The world economy has entered an era of total competition. Traditional barriers have begun to fall, new-sophisticated competitors have emerged, and global rivalry increased. There are many examples around the world where the traditional sources of comparative advantage are less valuable than initially perceived for the development of a strong, competitive economy.
The new type of development is one that involves the whole market and all institutions in the economy. Productivity is that component which creates a competitive advantage rather than a comparative advantage; the latter only addresses only the supply side of the market system and ignores demand, historical chance and the role of government. Indeed, the model of competitive advantage addresses the question of development today.
A nation’s standard of living is increasingly dependent on the competitiveness of its economy. Competitiveness is vital if the nation’s firms are to take advantage of the opportunities opened up for them in the international arena. World trade and foreign investment have grown faster than world output in the last several decades.
This paper is essentially divided into three main chapters. The first chapter defines competitiveness and characterizes the main factors that influence it. The end of the chapter describes the main stages of the development of competitiveness, proposed by Michael E. Porter. The second chapter analyses competitiveness from a global perspective. It starts with explaining the methodology used in international competitiveness rankings, as well as presenting the main two institutions, which deal with this classification. It then analyzes the principles of global competitiveness and ends up with a presentation of the methods of creating competitive advantages, which are based on Stephane Garelli’s ten golden rules of competitiveness. The third chapter presents the situation of competitiveness in Moldova....
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