International Competitiveness At Macro, Meso And Micro Level

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1.Define the concept international competitiveness at macro, meso and micro level. Macro level The Porter’s Diamond illustrates the determinants of national advantage . There are six points on the Diamond. 1) Factor conditions, when a country has their own ability of resources and skills it has an advantage on its competitors. 2) Demand conditions, when the market for a particular product is larger locally than in foreign markets, the local firms begin leading to a competitive advantage. 3) Related and supporting industries, when local supporting industries are competitive, firms enjoy more cost effective and innovative inputs. 4) Firm strategy, structure and rivalry, what kind of structure or strategy a firm uses is important to determine if a firms has advantages and therefore the more rivalry and/or the more disadvantages. 5) Government plays a powerful role in encouraging the development of industries within their own border, if the government invests money and make the rules for the firm easier. Firms in that area have more advantage. 6) Chance. The effect of one point depends on the others. For example, factor disadvantages will not lead the firm to innovate unless there is sufficient rivalry. The diamond as a whole affects four ingredients that lead to a national comparative advantage. These ingredients are: 1) the availability of resources and skills. 2) information that firms use to decide which opportunities to pursue with those resources and skills, 3) the
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