The assessment: international competitiveness

The concept of international competitiveness, as applied to national economies, is a popular one. Politicians, businessmen, and economists alike, re fer to it in day-to-day discussion when looking at the external (export, import, market share, or trade balance) performance of different countries. Indi cators are produced showing changes in, or levels of, various countries' competitiveness (e.g. the relative price or cost indices regularly published by the IMF and the OECD, or the absolute measures produced by organizations such as the Geneva World Economic Forum and the Lausanne Institute for Management Development). Governments of ten instigate research on the matter as, for instance, in the case of the 1993 US Competitiveness Policy Council orthe 1995 EU Competitiveness Advisory Group. Yet, it has recently been argued by Paul Krugman that 'competitiveness is a meaningless word when applied to national economies. And the obsession with competitiveness is both wrong and dangerous' (Krugman, 1994,p.44),apositionKrugman forcefully reaffirms in his contribution to this issue of the Oxford Review of Economic Policy.

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