Measures of international competitiveness: A critical survey∗ †

An examination of the extant literature on competitiveness reveals a wide variety of notions and extreme difficulties of measurement and application.

Single measures of competitiveness do not capture all the elements of the concept. Useful measures have to specify the level of analysis (national, industry, firm or product) and encompass competitive performance, its sustainability through the generation of competitive potential and the management of the competitive process. The interrelationship between these three key elements are also important in a dynamic context.

The effectiveness of management is essential to this analysis and the concept of industrial effectiveness at the management level enables a link to be established between the concept of competitiveness and an empirical investigation of decision making. A framework is derived which is of general use and specific measures are proposed to fill the “empty boxes” suggested.