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Economic competitiveness

[ Summary ]


Chapter 2:
Analysing an area’s economic competitiveness


2.5 Summary


The following table summarises the levels of analysis for each of the four components of the territorial capital [4] more specifically involved in economic competitiveness:

What conclusion can be drawn from this summary in terms of economic competitiveness?

Using the definition of economic competitiveness presented in our introduction, and based on the elements for analysing the four components of an area’s capital, we can draw a comparison between the two types of economic competitiveness, relating to businesses or to the area. Business competitiveness is the ability of firms to withstand competition, and territorial competitiveness is the area’s ability to create and keep value added.


1- Analysis of existing assets and potential 2- Analysis of utilisation 3- Analysis of organisational systems 4- Analysis of values and/or knowledge
Levels Skills and know-how Existing skills in the area How are such skills promoted? Training and capitalisation systems Awareness of skills and needs
Financial resources Current and potential capital available Harnessing capital and putting it to work Organisation and financial engineering Motivation and trust between operators
Businesses Existing businesses Business operation Business support mechanisms Values underpinning the business fabric
Links with markets Products and services (the area’s offering) Market segments concerned Organisational structure to achieve market positioning Producers’ knowledge of markets


The following table summarises the elements that can be drawn from the four components in relation to the two types of economic competitiveness.


Type of economic competitiveness
Corporate economic competitiveness Territorial economic competitiveness
Components Ability to promote skills and know-how Good personnel management within the enterprise At area level: no unemployment
Ability to made good use of financial resources Good financial management of the enterprise Financial flexibility at area level
Ability to create and ensure good business management Ability of the enterprise to renew and innovate Entrepreneurial dynamism: setting up businesses, etc.
Ability to forge links with markets Individual or sectorial organisation of links to markets Collective organisation at area level (promotion, charters, etc.)
End result Ability to ensure the financial profitability of the enterprise and to withstand competition Ability to create value added and keep it in the area


[4] See “Constructing a territorial
development strategy in the light of the
LEADER experience Part 1: "territorial
, LEADER European
Observatory, 2000.

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