ips national competitiveness research 2014-2015 · 2018-07-20 · ips national competitiveness...

IPS National Competitiveness Research 2014-2015

Created Advantage as the Source of Competitiveness

Dong Sung Cho and Hwy Chang Moon

Seoul National University

Republic of Korea

Contents

Fundamental Source of Economic Growth

Conclusion

Theory, Methodology, and Results

Comparison of Three National Competitiveness Reports

2

Contents

- Reports: IPS,WEF, and IMD


Conclusion



3

Reports: IPS ,WEF, and IMD

4

Three Reports on National Competitiveness

Three major National Competitiveness Research Institutions

IMD IPS WEF

5

Overview of the Three Reports

Items

Theoretical Base

Data

Weights

° DD Based 9-Factor

Model (IPS model)

° Hard data: 1/2

° Soft data: 1/2

° Different weights for

different strategies

NCR (IPS)

2014-2015

° No particular theory

° Hard data: 2/3

° Soft data: 1/3

° Hard data: 2/3

° Soft data: 1/3

WCY (IMD)

2015

° No particular theory

° Hard data: 1/3

° Soft data: 2/3

° Different weights for

different groups

GCI (WEF)

2015-2016

Partner

institutes

3. Policy

implications

° KOTRA offices abroad

° 3Ⅹ3 Framework

° Universities and other

institutes

° Population

° Per capita income

° Region

° Universities and other

institutes

° Factor-driven stage

° Efficiency-driven stage

° Innovation-driven stage

No. of countries ° 62 countries ° 61 countries ° 144 countries

Not organized

Lacking theoretical rigor

Strong theoretical basis

Various analytical tools

VS

6

Me

tho

do

log

y

Change of Factors in the IMD and WEF Reports

Domestic Economy

Internationalization

Government

Management

Finance

Infrastructure

Science and Technology

People

IMD

Economic Performance

Government Efficiency

Business Efficiency

Infrastructure

1989 2001

Population

2003 2015

Population

GDP per capita

Region

2004

Note: GCI: Growth Competitiveness Index , GCI*: Global Competitiveness Index, CCI: Current Competitiveness Index,

MICI: Microeconomic Competitiveness Index, BCI: Business Competitiveness Index

WEF

Civil Institutions

Openness

Government

Management

Finance

Infrastructure

Technology

Labor

1996 2000

GCI

CCI MICI BCI

2002 2003 2006

GCI*

2015 2008

• Aggregate Country

Performance Indicators

• Macroeconomic Environment

• Technology:

Innovation and Diffusion

• Human Resources:

Education, Health, and Labor

• General Infrastructure

• Public Institutions

• Domestic Competition and

Cluster Development

• Company Operation and Strategy

• Environment

(2005~2006, 9 pillars)

• Market Efficiency

• Technological Readiness

• Business Sophistication

• Innovation

• Environment

(2006~2007, 11 pillars)

• Basic Indicators

• Institutions

• Infrastructure

• Macroeconomy

• Health and Primary Education

• Higher Education and Training

• Financial market

sophistication

• Technological readiness

• Market size

• Business sophistication

• Innovation

(2007~2008, 12 pillars)

• Institutions

• Infrastructure

• Macroeconomic stability

• Health and primary education

• Higher education and training

• Goods market efficiency

• Labor market efficiency


sophistication


• Market size


• Innovation

(2008~2009, 12 pillars)

• Institutions

• Infrastructure







sophistication


• Market size


• Innovation

(2009~2010, 12 pillars)

• Institutions

• Infrastructure






• Financial market development


• Market size


• Innovation

(2011~2015, 12 pillars)

• Institutions

• Infrastructure

• Macroeconomic environment





7

United States

Germany

United Kingdom

Without theoretical validity? (1)

1 1 1 1 1 1 1 1

3

1 2

1 1 1

1 2 2

2

6

1 1 2

4 5

7

5

3 3

0

2

4

6

8 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

15

20 21

23 26

16 16 13 16

10 9 9

6 10 14 13

13 15

8 5

7 7 5 6 6

4 4 4

0

10

20

30

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

16

19 22 22

21 20 21 21 22

20

18 18 16 19

11 15

11 13

10 9

12 13

12 10

8 10

9

10

0

10

20

30

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

8

Discrepancy of

Rankings

Hong Kong

Singapore

Malaysia

Without theoretical validity? (2)

Discrepancy of

Rankings 13

10 6

3 2 3 3 2 2 1 1

3 4 2

17

24 21

14 10

12 11 11 11 11

9 7 7

7

0

10

20

30 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

8

4

2 2

3 2

2

3

1

3 4

5

3 3

4

6 7

5

8 7

5

3

1 2 2 2 2

2

0

5

10 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

26 21

16

28

22 23

19 18

10

16

14 15 12

14

27 29 31

25

19 21

21 24

26

21

25 24

20

18

0

5

10

15

20

25

30

35 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IMD

WEF

9

Contents

- Theories

- Measurement: IPS Model

- Result 2014-2015

- Analysis: Country Grouping

- Simulation: Cost & Differentiation Strategies


Conclusion



10

Theories

11

The Productivity Model:

• Competitiveness was not the issue those days.

• Capital and labor as two determinants, thus P = f (K,L)

This model failed to explain:

• Why resource-lacking countries are more affluent than

resource-rich nations in general.

Sources of National Competitiveness Before the 1980s

12

Concept of the Productivity Model

Endowed

Resources National

Competitiveness

13

A New Model should be:

• comprehensive enough to include non-

quantitative variables to better explain the increasingly complex nature of the world economy

• dynamic enough to better reflect the ever-changing nature of national competitiveness

In response to the White House Presidential Commission on

Industrial Competitiveness, Michael Porter (1990) proposed

a Diamond Model as a means to explain a nation’s competitiveness.

Sources of National Competitiveness Since the 1980s

14

Comparison of the Productivity Model & the Diamond

Business Context

National

Competitiveness

Related & Supporting

Industries

Domestic

Market

Endowed

Resources

Chance 15

Characteristics of the Diamond Model

The first model to encompass non-quantitative variables, which are mostly physical in nature

Not so relevant to developing and underdeveloped economies

• It was mainly designed for developed economies, failing to fully

identify sources of NC that are characteristics of developing and underdeveloped economies.

Cho (1994) proposed the 9-Factor Model of NC

by including human factors as additional variables in the Diamond.

16

Comparison of the Productivity Model

Business Context

National

Competitiveness

Related & Supporting

Industries

Domestic

Market

Endowed

Resources

Chance

Workers

Professional Managers,

Engineers, Designers

Politicians &

Bureaucrats

Entrepreneurs

The Diamond & the 9-Factor Model

17

Time

Insufficient

Managerial &

Technological

Innovation

Lack of

Entrepreneurship

Low

High

Competitiveness

No

Policy

Workers

Endowed Resources

Politicians

& Bureaucrats

Business Context

Entrepreneurs

Related/supporting Industries

Professional Managers,

Engineers, Designers

Demand Conditions

LDC NIC SDC FDC Economic Stage

Physical factors

Human factors

Dynamics of National Competitiveness

18

Measurement: IPS Model

19

62 Countries

20

Europe (19) Asia (24) America (12) Oceania (2)

• Austria

• Belgium

• Croatia

• Czech Republic

• Denmark

• Finland

• France

• Germany

• Greece

• Hungary

• Italy

• Netherlands

• Poland

• Russia

• Spain

• Sweden

• Switzerland

• Ukraine

• United Kingdom

• Bangladesh

• Cambodia

• China

• Hong Kong

• India

• Indonesia

• Iran

• Israel

• Japan

• Jordan

• Korea

• Kuwait

• Malaysia

• Oman

• Pakistan

• Philippines

• Saudi Arabia

• Singapore

• Sri Lanka

• Taiwan

• Thailand

• Turkey

• U.A.E.

• Vietnam

• Argentina

• Brazil

• Canada

• Chile

• Columbia

• Dominican Republic

• Guatemala

• Mexico

• Panama

• Peru

• United States

• Venezuela

• Australia

• New Zealand

Africa (5)

• Egypt

• Kenya

• Morocco

• Nigeria

• South Africa

Theoretical Background

Model 1: Diamond Model

- Porter (1990)

- Porter (1998)

- Porter (2007)

Physical Factors Human Factors

Model 2: 9-Factor Model

- Cho (1994)

- Cho & Moon (2000)

Sco

pe o

f C

om

peti

tiven

ess

Model 3: Double Diamond Model

- Rugman (1991)

- Rugman & D’Cruz (1993)

- Moon, Rugman &

Verbeke (1995,1998)

Model 4: IPS Model

Cho, Moon, & Kim (2008, 2009)

Do

mesti

c

Inte

rnati

on

al

Source of Competitiveness

21

IPS Model

Note: The figure in the parenthesis indicates the number of criteria in each factor.

Factor

Conditions

•Energy Resources

•Other Resources

Demand

Conditions

•Size

•Quality

Related Industries

•Industrial Infrastructure

•Coordination & Synergy

Business Context

Workers

•Quantity

•Quality

Professionals

•Personal Competence

•Social Context

Entrepreneurs

•Personal Competence

•Social Context

Politicians &

Bureaucrats

•Structure

•Strategy

•Politicians

•Bureaucrats

Double Diamond-based 9 Factor Model

(11) (19) (9) (8)

(25) (10)

(15) (9)

22

Result 2014-2015

23

Rank Country Index

22 Russia 40.24

23 Saudi Arabia 40.23

24 Austria 39.95

25 Belgium 39.88

26 Korea 39.80

27 Indonesia 37.92

28 Chile 37.36

29 Jordan 37.23

30 Thailand 37.10

31 Panama 37.08

32 Poland 36.60

33 Brazil 36.50

34 Philippines 36.49

35 Vietnam 36.17

36 Hungary 36.13

37 Italy 35.96

38 Oman 35.83

39 Mexico 35.51

40 Malaysia 34.28

41 Egypt 33.80

42 Colombia 33.11

Rank Country Index

1 China 57.39

2 Canada 56.22

3 United States 55.76

4 Singapore 55.76

5 Hong Kong 53.25

6 Australia 51.62

7 Sweden 51.18

8 Switzerland 48.98

9 Finland 47.64

10 Taiwan 46.80

11 Denmark 46.49

12 Germany 45.37

13 New Zealand 45.06

14 Netherlands 45.03

15 Israel 44.99

16 India 44.40

17 U.A.E. 43.60

18 Kuwait 42.00

19 France 41.25

20 Japan 40.95

21 United Kingdom 40.32

Note: Rankings when all competitors employ cost strategy

NCR 2014-2015 Rankings (Cost Strategy)

Rank Country Index

43 Czech Republic 33.08

44 Peru 32.83

45 Spain 32.72

46 Argentina 32.48

47 Turkey 32.33

48 Dominican Republic 32.22

49 Cambodia 31.96

50 Pakistan 30.58

51 Greece 30.34

52 Morocco 29.65

53 Ukraine 29.06

54 Guatemala 29.06

55 Nigeria 28.16

56 Bangladesh 27.12

57 Iran 26.70

58 Sri Lanka 25.14

59 Croatia 24.10

60 South Africa 23.46

61 Venezuela 22.66

62 Kenya 19.66

24

Rank Country Index

43 Turkey 37.66

44 Mexico 37.51

45 Morocco 37.32

46 Argentina 36.04

47 Cambodia 35.92

48 Greece 35.71

49 Bangladesh 35.67

50 Russia 35.61

51 Ukraine 34.98

52 Colombia 34.45

53 Peru 33.83

54 South Africa 33.66

55 Brazil 33.34

56 Guatemala 32.97

57 Pakistan 31.13

58 Croatia 28.75

59 Iran 27.65

60 Kenya 25.65

61 Sri Lanka 25.18

62 Venezuela 17.99

Rank Country Index

22 Italy 52.88

23 U.A.E. 52.64

24 Hungary 50.12

25 Thailand 49.22

26 Poland 48.10

27 United Kingdom 47.88

28 Indonesia 47.06

29 Philippines 46.17

30 Czech Republic 46.07

31 Kuwait 45.38

32 Spain 45.34

33 Jordan 43.42

34 Vietnam 42.63

35 Panama 42.38

36 Oman 41.29

37 Saudi Arabia 41.25

38 Nigeria 40.64

39 Dominican Republic 40.54

40 Egypt 40.35

41 Malaysia 40.03

42 Chile 37.84

Rank Country Index

1 Singapore 76.08

2 Switzerland 75.00

3 Denmark 73.66

4 Canada 71.55

5 Hong Kong 71.43

6 Sweden 70.95

7 Finland 70.93

8 Australia 67.36

9 Israel 66.17

10 Taiwan 65.56

11 United States 65.00

12 Germany 64.28

13 Belgium 62.25

14 Netherlands 62.23

15 Korea 56.80

16 Austria 56.73

17 New Zealand 55.41

18 China 55.40

19 Japan 55.27

20 India 54.64

21 France 54.10

Note: Rankings when all competitors employ differentiation strategy

NCR 2014-2015 Rankings (Differentiation Strategy)

25

Factor Conditions Business Context Related industries Demand Conditions

1: China

2: Russia

3: United States

4: Canada

5: Brazil

......

49: Korea

1: Sweden

2: Singapore

3: Israel

4: Hong Kong

5: Canada

......

14: Korea

1: Taiwan

2: Switzerland

3: Singapore

4: Hong Kong

5: Finland

……..

19: Korea

1: United States

2: Singapore

3: Germany

4: Switzerland

5: Denmark

......

12: Korea

Physical Factors

Workers Politicians & Bureaucrats Entrepreneurs Professionals

1: China

2: Singapore

3: Taiwan

4: Hong Kong

5: Canada

......

13: Korea

1: Singapore

2: Denmark

3: Sweden

4: Finland

5: Hong Kong

......

35: Korea

1: Israel

2: Singapore

3: Switzerland

4: Canada

5: Taiwan

......

22: Korea

1: Singapore

2: Denmark

3: Switzerland

4: Hong Kong

5: Canada

......

13: Korea

Human Factors

26

Top 5 Countries of 8 Factors

Factor Conditions, (49)

Business Context, (14)

Related Industries, (19)

Demand Conditions,

(12)

Workers, (13)

Politicians &

Bureaucrats, (35)

Entrepreneurs, (22)

Professionals, (13)

0

10

20

30

40

50

60

70

Factor Rankings of Korea

Physical Factors Human Factors

Note: The figure in the parenthesis indicates the ranking of each factor.

27

Ran

k

Analysis: Country Grouping

28

Typology of Country Group

Strong-Small

Countries

(强小國)

Strong-Medium

Countries

(强中國)

Strong-Large

Countries

(强大國)

Intermediary-

Small

Countries

(中小國)

Intermediary-

Medium

Countries

(中中國)

Intermediary-

Large

Countries

(中大國)

Weak-Small

Countries

(弱小國)

Weak-Medium

Countries

(弱中國)

Weak-Large

Countries

(弱大國)

Weak

(弱)

Intermediary

(中)

Strong

(强)

National

Competitiveness

SizeLarge

(大)

Medium

(中)Small

(小)

29

Country Group: Result

Sm

all

Stro

ng

1 Singapore

2 Hong Kong

3 Switzerland

4 Denmark

5 Israel

6 Netherlands

7 Belgium

8 Austria

9 U.A.E.

Inte

rme

dia

ry

1 Kuwait

2 Hungary

3 Panama

4 Jordan

5 Czech Republic

6 Dominican Republic

We

ak

1 Greece

2 Guatemala

3 Croatia

Small Group

Med

ium

Stro

ng

1 Sweden

2 Finland

3 Taiwan

4 New Zealand

5 Korea

6 United Kingdom

7 Italy

Inte

rme

dia

ry

1 Poland

2 Spain

3 Oman

4 Chile

5 Malaysia

We

ak

1 Morocco

2 Cambodia

3 Ukraine

4 Kenya

5 Sri Lanka

6 Venezuela

Medium Group

Larg

e

Stro

ng

1 Canada

2 United States

3 Australia

4 Germany

5 China

6 Japan

7 France

8 India

Inte

rme

dia

ry

1 Thailand 2 Philippines 3 Indonesia 4 Saudi Arabia 5 Vietnam 6 Russia 7 Mexico

We

ak

1 Egypt 2 Turkey 3 Brazil 4 Nigeria 5 Colombia 6 Argentina 7 Peru 8 Pakistan 9 Bangladesh

10 South Africa 11 Iran

Large Group

1. U.A.E is included in Small-Strong from Small-Intermediary Group.

2. Dominican Republic is included in Small-Intermediary from Small-Weak Group.

3. Italy goes up to Medium-Strong from Medium-Intermediary Group.

4. India goes up to Large-Strong from Large-Intermediary Group.

5. Mexico goes up to Large-Intermediary from Large-Weak Group.

6. Brazil falls down to Large-Weak Group from Large-Intermediary. 30

0.14

0.49

0.90 0.95

1.11

1.04

0.95

0.86

1.12

0.89

0.42

0.79

1.20

0.65

1.20

0.93

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

Korea: Comparison with Other Medium-Strong Countries

En

erg

y R

es

ou

rce

s

Oth

er R

es

ou

rce

s

De

ma

nd

Siz

e

De

ma

nd

Qu

ality

Ind

us

trial In

fras

truc

ture

Co

ord

ina

tion

an

d S

yn

erg

y

Stru

ctu

re

Stra

teg

y

Qu

an

tity o

f La

bo

r Fo

rce

Qu

ality

of L

ab

or F

orc

e

Po

liticia

ns

Bu

rea

uc

rats

Pe

rso

na

l Co

mp

ete

nc

e S

oc

ial C

on

tex

t

Pe

rso

na

l Co

mp

ete

nc

e

So

cia

l Co

nte

xt

Factor

Conditions

Business

Context

Related

Industries

Demand

Condition

Workers Politicians &

Bureaucrats

Entrepre-

neurs

Professionals

• Relatively strong in Industrial infrastructure, Quantity of Labor Force, and Personal

Competence of Entrepreneurs and Professionals

• However, weak particularly in Energy and Other Resources, Politicians, and Social

Context of Entrepreneurs

1

31

Simulation: Cost & Differentiation Strategies

32

Low

Medium

High

Competitive

Strategy

Cost

Strategy

Human

Physical

Workers

Factor

Conditions

Politicians &

Bureaucrats

Business

Context

Entrepreneurs

Related

Industries

Professionals

Demand

Conditions

Co

mp

eti

tiven

ess

Strategy Simulation

Differentiation

Strategy

33

Weights for Cost Strategy and Differentiation Strategy

C*: Cost Strategy, D*: Differentiation Strategy

Main Factors Weights

Sub-factors Weights

C* D* C* D*

Physical

Factors

Factor

Conditions 32/120 4/120

Energy Resources 1/2 1/2

Other Resources 1/2 1/2

Business Context 16/120 8/120 Structure 3/4 1/4

Strategy 1/4 3/4

Related Industries 8/120 16/120 Industrial Infrastructure 3/4 1/4

Coordination and Synergy 1/4 3/4

Demand

Conditions 4/120 32/120

Demand Size 3/4 1/4

Demand Quality 1/4 3/4

Human

Factors

Workers 32/120 4/120 Quantity of Labor Force 3/4 1/4

Quality of Labor Force 1/4 3/4

Politicians &

Bureaucrats 16/120 8/120

Politicians 3/4 1/4

Bureaucrats 1/4 3/4

Entrepreneurs 8/120 16/120 Personal Competence 3/4 1/4

Social Context 1/4 3/4

Professionals 4/120 32/120 Personal Competence 3/4 1/4

Social Context 1/4 3/4

34

11

15

18

32

12

13(13)

15

31

19

Korea

14

Japan

Strategy Simulation (2014): Korea•China•Japan

CS NS DS

Korea: higher with DS Japan: higher with DS China: higher with CS

19

17

Note: 1) NS: Neutral Strategy, CS: Cost Strategy, DS: Differentiation Strategy. 2) The upper number of each triangle is the

country’s ranking when its competitors keep their neutral strategies. 3) The lower number of each triangle is the country’s

ranking when its competitors have their optimal strategies.

China Korea

China

Japan

35

42

0

20

40

60

Ran

kin

g

10

30

50

37

DS Prediction Scenario : Korea•China•Japan

36

Comparison under Differentiation Strategy

• Under the Differentiation Strategy scenario, China surpassed Japan in 2011-12 for the first time

• In 2019, China will surpass both Japan and Korea (estimate)

30 31

28

24

26

23

22 20

18

21

20 22

20

22

17

14 16

15 15

10

15 14

16

20

23 22

19

0

5

10

15

20

25

30

2005 2006 2007 2008-09 2009-10 2010-11 2011-12 2012-13 2014-15 2017 2019

China

Korea

Japan

Present

Estimate

China Surpassed

Japan

China will Surpass

both Japan &

Korea

Contents

- BRICS case

- Absolute & Relative Created Competitiveness


Conclusion



37

BRICS case

38

BRICS case 2014-2015 (1)

These five countries have grown

significantly and are considered

important players in the global

economic scenario

0

2000

4000

6000

8000

10000

12000

14000

16000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Source: World Bank, www.worldbank.org/data/wdi, accessed Oct, 14, 2015

Rapid growth of the BRICS 11385

12736

Russia

Brazil

China

India

South Africa

7594

6478

1596 2535 2810

2375 1142 481

(GDP per capita)

-10

-5

0

5

10

15

20

BRICS GDP growth rate (annual %)

China

India

Brazil South Africa

Russia

Going up

Going down

However, it is observable that the

growth rate of China and India is

relatively higher than South Africa,

Brazil and Russia’s growth rate

39 Source: World Bank, www.worldbank.org/data/wdi, accessed Oct, 14, 2015

http://www.worldbank.org/data/

http://www.worldbank.org/data/

BRICS case 2014-2015 (2)

33

40 42 47

38

32 33 28

24 22 21 22

45

37 32

24 24 21 20

17 15 15 15 14

42

33

34

40 45 45 47 46 45 43

40 39

60 49 46

53

47 42

45 48 51

54 56 57

38 36 33 37 42 41 43 44 44 42 41

45

0

10

20

30

40

50

60

2001 2002 2003 2005 2006 2007 2008 2009 2010 2011 2012 2014

China

India

Russia

Brazil

South Africa

National Competitiveness Ranking (2001-2014)

BRICS Economies commonly

have affluent inherited resources

However, why are some

countries’ rankings continuously

going up but some are not?

Going up

Going down

Economic Growth And

India's Global Rise South Africa

heading for a recession July 14 2015 at 12:35pm

AUG 17, 2015 12:30 PM

Brazil's economy enters

recession 28 August 2015

World Bank Downgrades Russia’s

Economic Outlook Updated Sept. 30, 2015 4:01 p.m. ET

China’s economy is in big trouble,

but it isn’t collapsing AUG 25, 2015 12:30 PM

vs.

40

Competitive Structures of BRICS Countries (2014-2015)

• Russia/S.Africa/Brazil(Group3): higher in Factor Conditions, but lower in other factors compared to China and India (Group

1)

• China and India (Group 3 ) should further increase each factor of created advantages to increase national competitiveness

41

F1, 1 F4, 24

F3, 29

F2, 9

F5, 1

F6, 26

F7, 13

F8, 26

-10

10

30

50

70

0 5 10

China

F1, 6

F4, 20

F3, 52

F2, 25

F5, 44

F6, 36

F7, 7

F8, 9

-10

10

30

50

70

India

F1, 2

F4, 56

F3, 34

F2, 41 F5, 52

F6, 48 F7, 54 F8, 52

-10

10

30

50

70

Russia

F1, 24

F4, 49 F3, 53

F2, 59 F5, 61

F6, 55

F7, 56

F8, 32

-10

10

30

50

70

South Africa

F1, 5

F4, 39 F3, 51

F2, 55

F5, 46

F6, 53

F7, 31

F8, 56

-10

10

30

50

70

Brazil

Rank

Rank

Rank

Rank

Rank

Physical Factors Human Factors Physical Factors Human Factors

Physical Factors Human Factors Physical Factors Human Factors Physical Factors Human Factors

1 1

1 1 1

Created Advantage and Competitiveness (2014-2015)

Group 1

Group 3

Group 2 Group 4

Created Advantage

High

High

Low

Low

Inh

eri

ted

Ad

van

tag

e

Based on the IPS research, BRICS can be divided into two groups;

1) China, India are classified under the high Created Advantage group

2) Russia, Brazil, South Africa belong to the low Created Advantage group

India China

South Africa

Russia Brazil

La

rge

Gro

up

Stro

ng

1 Canada

2 United States

3 Australia

4 Germany

5 China

6 Japan

7 France

8 India

Inte

rme

dia

ry

1 Thailand

2 Philippines

3 Indonesia

4 Saudi Arabia

5 Vietnam

6 Russia

7 Mexico

We

ak

1 Egypt

2 Turkey

3 Brazil

4 Nigeria

5 Colombia

6 Argentina

7 Peru

8 Pakistan

9 Bangladesh

10 South Africa

11 Iran

Looking through the IPS Group Criteria,

• (Size) All BRICS economies belong to the Large Group

• (Competitiveness) China and India are included in the Strong Group. Russia is under the Intermediary Group while Brazil

and South Africa are in the Weak Group.

42

Absolute & Relative

Created Competitiveness

(10-year Ave.)

43

Absolute & Relative Created Competitiveness (10-year Ave.) (1)

Group1 High created advantage

without change

Group 2 High created advantage

with change

Group 4 Low created advantage

without change

Group 3 Low created advantage

with potential

Increase Rate of Created Advantage (Relative)

High

High

Low

Low

In

dex V

alu

e o

f C

reate

d

ad

van

tag

e (

10

- year

avera

ge)

• (Group 1) attains high absolute created advantage but without any change (e.g. developed countries)

• (Group 2) has high absolute created advantage and also high relative created advantage

• (Group 3) obtains high potential due to high relative created advantage despite of low average created advantage

• (Group 4) is characterized by both low absolute average absolute and relative created advantage but has high potential

44

45

Group 1

1 United States

2 Sweden

3 Hong Kong

4 Canada

5 Finland

6 United Kingdom

7 Australia

8 Israel

9 Germany

10 France

11 Austria

12 Taiwan

13 Japan

14 New Zealand

15 Korea

16 Italy

17 Spain

18 Hungary

19 Greece

Group 2

1 Netherland

2 Singapore

3 Denmark

4 Switzerland

5 Belgium

6 Thailand

7 China

8 Chile

9 Poland

10 Philippines

11 UAE

Group 3

1 Mexico

2 India

3 Panama

4 Czech Republic

5 Jordan

6 Kuwait

7 Indonesia

8 Saudi Arabia

9 Guatemala

10 Vietnam

11 South Africa

12 Dominican Republic

13 Oman

14 Turkey

15 Peru

16 Egypt

17 Nigeria

18 Kenya

19 Bangladesh

20 Cambodia

21 Iran

Group 4

1 Malaysia

2 Columbia

3 Brazil

4 Russia

5 Croatia

6 Morocco

7 Pakistan

8 Sri Lanka

9 Argentina

10 Ukraine

11 Venezuela


46

Group1 Group 2

Group 4 Group 3

A

B

C D

stages of

economic growth

Link pin country

between A and B group

Link pin country between

B and C group

Link pin country between

C and D group

BRICS economies in

status quo

BRICS economies in

downfall

Remarkable

Emerging Economies

-Note-

Increase Rate of Created Advantage (% / 10-year average)

Ind

ex

Va

lue

of

Cre

ate

d a

dva

nta

ge (

10

- ye

ar

ave

rag

e)

BRICS economy

standing at a cross road


BRICS

BRICS

BRICS

BRICS

BRICS

Contents


Conclusion



47

National/Corporate Goal

Conclusion

Source for Growth - Inherited vs. Created

Policy Tools - Simple vs. Comprehensive

Policy Direction - Blue Ocean vs. Benchmarking + alpha

48

Thank you

49

ips national competitiveness research 2014-2015 · 2018-07-20 · ips national competitiveness...

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