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International Competitiveness

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  • Jan Fagerberg

    (Centre for Technology, Innovation and Culture, University of Oslo)

Abstract

This paper develops and tests a model of differing trends in international competitiveness and economic growth across countries. The model relates the development of market shares at home and abroad to three sets of factors: the ability to compete in technology, the ability to compete in delivery(capacity) and the ability to compete in price. The test, using data for 15 OECD countries for the period 1961-1983, shows that in the medium and long run, factors related to technology and capacity are very important for market shares and growth, while price- or cost competitiveness plays a more limited role than often assumed. These results are shown to be consistent with earlier findings by Kaldor and others of a "perverse" (positive) relation between export performance and growth in relative prices or costs.

Suggested Citation

  • Jan Fagerberg, 1988. "International Competitiveness," Working Papers Archives 1988001, Centre for Technology, Innovation and Culture, University of Oslo.
    • Handle: RePEc:tik:wparch:1988001
    Note: This is the accepted version of ÒFagerberg, J. 1988 International competitiveness, Economic Journal, Vol. 98, No. 391, June 1988, pp. 355-374Ó, which is available in final form at http://www.jstor.org/stable/223337.
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    File URL: http://www.tik.uio.no/InnoWP/archive/wpno001-1988.pdf
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    References listed on IDEAS

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    1. Anthony P. Thirlwall, 2011. "The Balance of Payments Constraint as an Explanation of International Growth Rate Differences," PSL Quarterly Review, Economia civile, vol. 64(259), pages 429-438.
    2. Fagerberg, Jan, 1987. "A technology gap approach to why growth rates differ," Research Policy, Elsevier, vol. 16(2-4), pages 87-99, August.
    3. Kellman, M, 1983. "Relative Prices and International Competitiveness: An Empirical Investigation," Empirical Economics, Springer, vol. 8(3-4), pages 125-138.
    4. Nerlove, Marc, 1971. "Further Evidence on the Estimation of Dynamic Economic Relations from a Time Series of Cross Sections," Econometrica, Econometric Society, vol. 39(2), pages 359-382, March.
    5. Ã…dne Cappelen & Nils Petter Gleditsch & Olav Bjerkholt, 1984. "Military Spending and Economic Growth in the OECD Countries," Journal of Peace Research, Peace Research Institute Oslo, vol. 21(4), pages 361-373, December.
    6. Maddala, G S, 1971. "The Use of Variance Components Models in Pooling Cross Section and Time Series Data," Econometrica, Econometric Society, vol. 39(2), pages 341-358, March.
    7. Smith, R P, 1977. "Military Expenditure and Capitalism," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 1(1), pages 61-76, March.
    8. Houthakker, Hendrik S & Magee, Stephen P, 1969. "Income and Price Elasticities in World Trade," The Review of Economics and Statistics, MIT Press, vol. 51(2), pages 111-125, May.
    Full references (including those not matched with items on IDEAS)

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