4.1.9 International Competitiveness

Question 1

What is International competitiveness

Answer 1

The ability of a nation to compete successfully in international markets and to sustain improvements in real output and wealth

Question 2

What are the 3 main ways of measuring international competitiveness

Answer 2

Relative unit labour costs - productivity - lower costs mean prices can be more competitive

Relative export prices - lower export prices make goods more competitive

Global Competitiveness index
-institutions (quality of gov)
-infrastructure
-stability of macroeconomic environment
-health and primary education
-higher education provision
-efficiency of the labour market
-efficiency of the financial market
-technology
-innovation

Question 3

What are some factors of the global competitiveness index

Answer 3

-institutions (quality of gov)
-infrastructure
-stability of macroeconomic environment
-health and primary education
-higher education provision
-efficiency of the labour market
-efficiency of the financial market
-technology
-innovation

Question 4

What are the price factors that determine competitiveness

Answer 4

Relative exchange rate
Relative inflation rates
Relative unit labour costs
Costs of capital

Question 5

What are the non-price factors that determine competitiveness

Answer 5

Quality
Innovation and R&D
Reliability