International Competitiveness

Question 1

Measures of International Competitiveness
(Mention definitions where necessary)

Answer 1

-Unit labour costs compared to trading partners:
total wage costs/output

-Export prices compared to trading partners

Question 2

Factors affecting international competitiveness
(give examples where necessary)

Answer 2

-Exchange rates

-Productivity
higher productivity-lower costs-lower prices

-Regulation

-Investment
Infrastructure, R&D

-Inflation

-Taxation

-Economic stability