What is the national competitive advantage?
The national competitive advantage is the evaluation of the ability of the nation competitively in international markets. Some nations have more advantages than other reasons. In order to support economic growth, governments can identify their strengths and weaknesses and play them to increase their national competitive advantage. One of the most popular evaluation frames for this purpose was developed by economist Michael Porter.
Some national competitive advantage comes from sources. These include not only natural resources, but also human capital, such as people with special talent. Nations can be able to expand their resources to increase the competitive advantage. For example, the establishment of a university to promote sciences would lead to more scientists who would create a new source for Earth. The more resources the country has, the more it can compete.
The ability to innovate is another factor. Nations that actively promote and support innovations can experience greater success in global markets. As with resources, the government may increase by different PHosts. For example, the nation could modify the patent laws to encourage society to develop new products for the open market, or it could finance the efforts that are likely to bring fruit if support is ensured.
Support sectors are also a key part of the national competitive advantage. For example, scientists need scientists suppliers of chemicals, tool manufacturers and other industries to support their work. Without a connected network of enterprises providing products and services, individuals with skills or innovative companies could not fully participate in the market. Part of the development of the national competitive advantage may therefore include the promotion of the service and support industry.
Local Pressure Requirements Pressures can also play a role. Some markets support innovations and development, while others are stagnant in nature. In a country where the technology industry is highly competitionFor example, technology companies are leading to continuous improvement and innovation. This in turn increases the competitiveness of the company in the international market because it can bring new technology to the market faster than competitors. The internal pressures form the external presentation of the economy by creating motivation for growth and development.
Michael Porter has designed a diamond of these four key features that could be compared, contrasted and assessed to determine the national competitive advantage. Standardized systems allow you to create easily compared power measurements. The evaluation created with such systems can provide information about how the country from year to year is.