The Relationships Between Michael Porter’s Theory of Competitiveness and Economic Development of Nations, Regions, and Cities and the Economics of Innovation

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Extract Eighteen years ago in his masterpiece “The Competitive Advantage of Nations” Michael Porter developed a model to analyze the competitiveness and economic development of nations, regions, and cities, a model that is still a milestone in this field of enquiry. In this work I will try to show how that theory about competitiveness is related with some important aspects of economics of innovation, also in the light of the already visible effects of globalization. Introduction I will first explain the effects of globalization as Kotler identified them in the last edition of his best-seller; then I will briefly resume the main concepts of Porter’s theory of competitiveness, showing two examples of how his national view of industrial…show more content…
I’m speaking of environmental awareness when nobody spoke of it, of the research for renewable sources of energy, and of the concept of business long-term sustainability. These particular forehanded attentions helped the building of the strongest paper industry of the world and one of the main interesting and innovative business model ever created, the Ikea one for the furniture production (without leaving behind other less famous examples). I can easily say that in this real case all the four factors Porter presented are well developed and inserted in a coherent network: as I said before in my opinion the government had the greater responsibility in creating the best organizational conditions to allow these results but the presence of high-culture social classes with definitively high expectations was and is another important trigger of Swedish development. Also the creation of an efficient and high technological supply-chain that links forests cutting with paper industry and furniture production, together with the presence of consistent capitals and high rate of competitiveness played an important role. However what in the end is very worth to be mentioned is that the government didn’t invest a lot of money in “rain fall” helps to the company: it was really the opposite, since some laws were very critics to be respected trying to have profit in such a
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