Microeconomics of Competitiveness (GRAV027)

The course explores determinants of competitiveness and successful economic development viewed from a bottom-up, microeconomic perspective. While sound macroeconomic policies and stable legal and political institutions create potential for industrial competitiveness, wealth is actually created at the microeconomic and firm levels. The sophistication and productivity of firms, the vitality of industrial clusters, and the quality of the business environment are the ultimate determinants of the productivity and innovation capacity of nations, regions and industries.

This course examines both advanced and developing economies and addresses competitiveness at multiple levels – nations, subnational units such as states or provinces, particular clusters, and neighbouring countries. The course is concerned not only with government policy but also with the roles that firms, industry associations, universities, and other institutions play in competitiveness. In modern competition, each of these institutions has an important and evolving role in economic development.

The course explores not only theory and policy but also the organizational structures, institutional structures, and change processes required for sustained improvements in competitiveness.

The Microeconomics of Competitiveness is a distinctive graduate course offered in cooperation with prof. M. Porter and a team of his colleagues at Harvard Business School (HBS), USA. It is designed to be taught to second year MBA students at HBS and affiliates of the Institute for Strategy and Competitiveness at Harvard Business School (http://www.isc.hbs.edu/moc.htm).

The main aim of the course is to enable the students to integrate and activate general knowledge on competitiveness in order to make analytical managerial decisions. The course focuses on the environment in which global strategy is developed at the corporate, business and operational levels. Particular attention is paid to the processes, competencies and vision of top management, competitive positioning, understanding comparative costs. Part of the purpose of the course is to expose students to some of the most successful countries and regions. In addition to cases, there are readings and videotaped appearances by guests who are national, regional, or business leaders involved in the cases studied or experts on the issues discussed in class.

• Analyse and evaluate the major elements of competitiveness
• Analyse, compare and evaluate the role of clusters.
• Analyse and evaluate the interaction between the micro level (entrepreneurial activity), meso level (regional clusters) and macro level (national policy).
• Analyse the complex relationship between government activity and business activity within institutions for collaboration.
• Apply knowledge in the framework of a concrete research project for a concrete country and cluster.