National economic development and the competitive advantage of nations

This chapter suggests that The Competitive Advantage of Nations has transformed thinking about the basis of national competitiveness and has had a big impact on public policies towards regional and national economic development. It is argued that Porter's analysis of the impact of national environment on international competitive performance demonstrates the potential for the theory of competitive strategy to rescue international economics from its slide into refined irrelevance, while simultaneously broadening the scope of the theory of competitive strategy to encompass both international dimensions and the dynamic context of competition. Nevertheless, it also suggested that the breadth and relevance of Porter's analysis have been achieved at the expense of precision and determinacy. Grant points out that concepts are often ill defined, theoretical relationships poorly specified, and empirical data chosen selectively and interpreted subjectively.