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The concept of national competitiveness has undergone a continuous process of evolution and revision, and the measurement methods have also kept pace with the times. Classical economists mainly measure or compare the competitiveness between countries based on the quantity of resources they possess. The early theory of comparative advantage was an attempt to explain how countries compete. However, economists have come to understand that comparisons of resource ownership alone are not enough to provide a convincing explanation. Entering the 20th century, the theoretical contributions of more scholars from Schumpeter to Porter have enabled us to further understand the meaning of competitiveness.
1. Various contemporary theories on competitiveness issues
(1) Theory of Innovation
J.A. Schumpeter wrote " The concept of economic innovation is put forward in the book "Economic Development Theory". He believes that "innovation" refers to "entrepreneurs implement new combinations of production factors", which includes the following five situations: (1) Introducing a new products or provide new quality of a product; (2) adopt a new production method; (3) open up a new market; (4) obtain a new source of supply of raw materials or semi-finished products; (5) implement a A new form of business organization. Innovation cannot occur without investment in knowledge and technology. If competitors cannot quickly detect new competitive trends, the first companies to invent innovations may rewrite each other's competitive landscape. New technologies, new customer demands, new industrial links, lowering upstream costs, and changes in government laws and regulations are all factors that cause changes in competitive advantages.
Professor Porter, the famous management guru, also attaches great importance to the role that innovation plays in companies gaining competitive advantage. What he calls innovation refers not only to technical improvements, but also to improvements in methods of doing things, such as new promotion methods and new organizational methods. If a company takes the lead in adopting innovative concepts without its competitors being aware of it, it is likely to change the competitive advantages of both parties. Porter believes that enterprises that enter the international market and compete must consider both the needs of the domestic market and the needs of the international market when innovating. If an enterprise focuses too much on the needs of the domestic market, it will damage its competitiveness in the international market. This is mainly because the demand for products by customers in the international market is different from the demand for products by customers in the domestic market. Moreover, manufacturers that focus on the domestic market have less pressure to innovate and are less willing to innovate. It should be pointed out that Professor Porter's greater contribution to the study of competitiveness issues is his diamond theory.
(2) Diamond System Theory
Porter's "Diamond System Theory" believes that: a country's production factors, demand conditions, support and related industries, corporate strategies, structures and peers Factors such as competition, chance variables and government are key elements of a country's competitive advantage. Because Porter listed the above elements into a rhombus-shaped pattern similar to a diamond, some people also call it the "rhombus theory."
Porter believes that abundant natural resources are the first key element of a country's competitive advantage. At the same time, he also admitted that when the country lacks certain production factors, this unfavorable phenomenon may also be converted into motivation and pressure for industrial upgrading. The second key element of a country's competitive advantage is domestic market demand. In Porter's view, there is no necessary relationship between the size of the domestic market and a country's competitive advantage; on the contrary, if it can stimulate corporate competition, be the first to develop high-end and sophisticated products, and lead the international market momentum, even if the domestic market is not large, it can still form competitive advantage of the industry. The third key element of a country's competitive advantage is the performance of supporting and related industries. Industries that can be systematized not only have the effect of drawing each other out, but can even be transformed into competitive advantages that other countries cannot imitate and are irreplaceable. The fourth key factor affecting a country's competitive advantage is corporate strategy, structure and industry competition. Enterprises are the basic units that create national wealth, and the corporate body is also a manifestation of national character. Different national characters will naturally lead to different forms of business operations and competition. Opportunity variables are variable factors that affect a country's competitive advantage. The source of opportunity may be natural evolution, or it may be caused by an accidental event. The key to the problem is how to capture the opportunity that is lost in a moment. The final variable is government. Excessive intervention and extreme laissez-faire are two undesirable extremes. The reasonable choice should be moderate intervention through industrial policy and other means.
Porter believes that the rise and fall of industries determined by their international competitiveness fundamentally determines the fate of a country.
On this basis, Porter divided the process of a country's industrial participation in international competition into four stages: factor-driven, investment-driven, innovation-driven, and wealth-driven. He believes that the source of national competitive advantage lies in the vitality of enterprises in various industries, and he is particularly concerned about the competitive advantages of enterprises. If the country can provide such a good environment for enterprises, industrial productivity can be greatly improved, the country will also benefit jointly, and national strength will also increase. To this end, Porter proposed the concept of value chain in his book "Competitive Advantage", believing that if various departments within an enterprise can be connected into a chain of functions, the value of the product will be enhanced, thereby forming its own competitiveness. In Porter's view, not every link in the value chain can create value. Those business activities that truly create value are the "strategic links" of the enterprise's value chain.
(3) Institutional theory
Nobel Prize winner Douglas North emphasized the importance of institutions in improving national competitiveness. He dismissed the idea that the industrial revolution was caused by accidental technological revolutions. Instead, we believe that we should turn our attention to how a society emerges from the long gestation process of the feudal system and the property rights system and moves towards the modernization stage. The development of an efficient economic organization in Western Europe was the reason for the rise of the West. For a country, economic growth will not simply occur unless the existing economic organization is efficient, that is, "efficient economic organization" is the key to economic growth. To maintain the efficiency of economic organizations, reasonable arrangements need to be made in the system to create an incentive to turn individual economic efforts into activities with private rates of return close to social rates of return (so-called legitimate economic activities). The conclusion drawn from this is that social development and change must show that the property rights system of the society is increasingly able to effectively mobilize the enthusiasm of individuals, so that limited resources and energy can be used in activities that are most beneficial to society, rather than on the contrary. If this institutional arrangement is very favorable, it can also overcome the shortcomings of the environment (natural and social resources).
Mancur Olson, another American economist, also emphasized the importance of institutions. He believed that economic development depends on institutional arrangements. Furthermore, a country's competitiveness is ultimately related to its institutional arrangements. Olson pointed out: While many developed countries have been stagnating, some developing countries have made amazing achievements in economic growth. Such widely divergent economic outcomes are by no means due to different countries possessing different capital or other resources. Generally speaking, this is not due to the fact that the countries with the best economic conditions have obtained a lot of capital, or that the people of certain countries have been forced to save a lot, nor is it due to the fact that these countries enjoy extremely large amounts of land and resources per capita. Abundant natural resources. Economically successful countries tend to have a variety of institutions—that is, different legal and organizational arrangements and economic policies—that less economically successful countries lack. In other words, the quality of a country's institutions fundamentally determines its economic effectiveness. In Olson's view, the market system is never perfect at the beginning. As long as its basic framework adapts to the requirements of productivity development, even if it is defective in some aspects, it will not hinder economic growth. It is impossible to wait until everything is arranged before developing. He believes that only in stable, trustworthy and developed democratic societies can the rights required for a prosperous market be relied upon in the long run.
2. Other views on competitiveness issues
(1) Views of WEF and IMD
World Economic Forum (WEF) and International Management Development in Lausanne, Switzerland Institute (IMD), two authoritative evaluation organizations of competitiveness, elaborated on their own concepts. It is believed that international competitiveness refers to the ability of a country's enterprises or entrepreneurs to design, produce and sell products and services, and its price and non-price characteristics are more market attractive than competitors. They believe that international competitiveness is a comprehensive concept. It includes two aspects. On the one hand, it is the competitiveness formed by the internal efficiency of the enterprise; on the other hand, it is the competitiveness formed by the environment. The latter is the more important content. Therefore, in their view, international competitiveness not only arises from the internal efficiency of enterprises, but also depends on the domestic, international and sectoral environment. The focus of comparative research on international competitiveness is competitiveness influenced by the environment.
The World Economic Forum's "Global International Competitiveness Report" is based on the economic growth of medium and long-term per capita GDP in the next 5-10 years, and establishes a systematic evaluation system determined by multiple factors. Its theoretical basis is neoclassical A synthesis of the economic growth theory of the school, the endogenous economic growth model of technological progress and a large number of empirical research literature. The "World International Competitiveness Yearbook" of the Swiss International Management Development Institute starts from the definition of the concept of international competitiveness, focuses on the current level, strength and development potential of the country as a whole, taking into account the asset conditions and competition process of international competition, the domestic economy and the global economy. The four major balanced relationships of the economic and social development of the entire country are the economy, introduction, absorption and export expansion, personal risk and social cohesion, strengthen the development and application of evaluation principles of market economy theory in system description, and establish a systematic and scientific comprehensive evaluation system. Both institutions evaluate the competitiveness of each country from the perspectives of domestic economic strength, internationalization, government management factors, finance, infrastructure, business management, science and technology, and national quality.
(2) Comprehensive national strength theory
Some scholars believe that national competitiveness is a reflection of a country’s comprehensive national strength. For example, Hans Morgenthau believes that national competitiveness is not only created by a country The ability of wealth is a symbol and is reflected in a country's military, political, cultural and diplomatic capabilities. He believes that behind international disputes lies the essence of competition for power between countries.
The Japanese divide comprehensive national strength into three aspects: first, the ability to contribute to the international community, including economic, financial, technological, financial strength and enthusiasm for external activities, as well as the ability to operate in the international community; second, survival Capabilities include population, resources, economic and defense strength, national will, and friendly alliances; third, coercive capabilities include military strength, strategic materials, technology, economy, and diplomatic capabilities. The calculation of comprehensive national strength uses the social survey method, also known as the Delphi method. This is an intuitive judgment and prediction method. It conducts surveys based on the three aspects of "national strength contribution ability", "survivability" and "coercive ability", and then scores and statistics based on the survey results. Finally, the average value is the national strength value. .
Klein, director of the Center for Strategic and International Studies at Georgetown University in the United States, also proposed a formula. The comprehensive national power equation is: comprehensive national power = (basic entity + economic capability + military capability) * (strategic intent + national will). Klein's comprehensive national power equation greatly simplifies the many factors that determine comprehensive national power. It is also difficult to find an objective and unified valuation standard for its strategic goals, national will, government factors, policy levels and other factors. Therefore, Klein's score often brings subject to the subjective assumptions of each rater. At the same time, Klein's formula is static, that is, it does not estimate comprehensive national strength from changes in the time process, and cannot evaluate the changing status of the same country's comprehensive national strength in different historical periods.
The German physicist Fuchs published the book "National Power Equation" that caused a sensation in the world in 1965. The author adopts a scientific method that simplifies the basic variables in physics and is based on the derived formula of extrapolation. He chooses a mathematical formula similar to the logical growth of biological species as the calculation of national power and its basic elements (such as population, steel, energy etc.), that is, using quantitative analysis methods to study the comprehensive national strength and potential of countries around the world. The formula is: Mt=0.5 [(Ms)t+(Me)t]. In the formula, Mt represents the national power index in period t; (Ms)t and (Me)t represent the steel and energy indexes in period t respectively. Later, Fuchs revised some of his original predictions in the 1978 edition of his book "The Great Powers of Tomorrow". Based on the fact that China's population growth, steel production and energy consumption for the 25 years from 1950 to 1975 were all developing faster than the United States and Western Europe, Fuchs predicted that the next century will be the Chinese century.
(3) Government policy theory
Government policy theory believes that the government's industrial goals, protection policies, export incentives, subsidies and other means are the foundation of national competitiveness. This argument is mainly based on the research of Japan, South Korea and other countries on a few large industries such as automobiles, steel, shipbuilding and semiconductors. However, this argument is obviously biased. For example: in Italy after World War II, the influence of government industrial policies was quite weak. However, Italy's export growth rate once ranked second in the world after Japan, and the country's living standards have also continued to improve. Even in Japan and South Korea, which have strong governments, the effectiveness of intervention has been unsatisfactory.
In Japan, the government's influence is very weak in important industries such as fax machines, robots, and advanced materials; many of Japan's successful companies, such as the automobile industry, are not actually targets of government support. Honda, which first entered the U.S. market, encountered numerous obstacles from relevant government departments in its global expansion and was almost forced to go out of business; the aircraft industry, which the Japanese government actively promoted since 1971, and the software industry, which began in 1978, have not yet succeeded. can rise to international leadership. Although some industries have achieved success under the protection of the government, they have paid a more expensive price. The South Korean government has invested ambitiously in petrochemical, machine tool and other industries, but its results are also lackluster. Looking around all countries, most of the industries in which the government has strong intervention are unable to gain a foothold in international competition. This shows that in the international competition of industries, although the government has its influence, it is by no means the protagonist.
(4) Management culture theory
Management culture theory believes that enterprises are the main body in creating national competitive advantages, and enterprise management culture theory also constitutes a perspective for studying this topic. This theory believes that each society has its unique cultural traditions and values, including explicit ideology and implicit collective consciousness, which together determine the social code of conduct and people's ideal pursuit, thereby determining It affects the organization of a country's economic life and thus affects the efficiency and speed of economic development. For example, Japan's traditional cultural concepts have formed a unique business model of Japanese companies. Among them, collective leadership, labor-management collaboration, lifetime employment, and total quality management are often considered to be the sources of competitive advantages of Japanese companies. The contribution of this theory is to see the deep role of corporate management culture on corporate operating efficiency, but it ignores another basic fact, that is, there is no universal corporate culture model. The cultural concepts that create competitive advantages in a specific period are not applicable to other companies. The occasion may become an obstacle to the development of the enterprise. In the 1990s, Japanese companies were facing this dilemma. In response, Honda Motor Co. recently adopted an American-style personal responsibility system, and Japan's Toyota Motor Corp., known for its lifetime employment system, also ended its history of never laying off workers.
(5) Labor organization theory
Labor organization theory understands a country’s competitive advantage from the irrational perspective of collective action. They believe that trade unions are reactionary organizations that hinder technological improvement. and obstacles to economic growth. In order to maintain their vested interests, trade unions do everything possible to prevent the implementation of advanced automation technology, hindering the marginal adjustment of human capital based on efficiency; trade unions have created a dual market structure of labor factors and formed wage rigidity, hindering the implementation of automation technology and Collaboration across professions. According to a survey conducted by the Massachusetts Institute of Technology in the United States, if compared by type of work and process, the individual efficiency of assembly workers in the American automobile industry is not lower than that of Japanese workers. However, if the efficiency of the entire production system is compared, Japanese companies are much higher. The main reason is that Japanese companies have flexible division of labor and good process coordination. In order to protect members' employment rights and prevent employers from reducing the number of employees, American labor unions divide jobs into very fine details during labor negotiations. The result is that it not only hinders the implementation of automation, but also hinders cooperation between processes, resulting in low production efficiency. , lost labor force. This theory only involves a phenomenon in industrial competition, and it cannot reveal the sources and factors that create national competitive advantages.
Looking at the various theories and views on competitiveness issues, it is not difficult to find that the early classical theories only provide us with an entry point to discuss competitiveness issues, and are not enough to explain the entire problem. . Later scholars' contributions have broadened our horizons in studying competitiveness issues to a certain extent. However, so far, there is no systematic and mature theoretical framework to guide people to explore the deep-seated issues of competitiveness from an economics perspective. , this cannot be said to be a shortcoming.