Strategies and Competitiveness for Emerging Countries: A Comparative Study among Three South-American Countries
International Journal of Emerging Markets 12:1 (2017)
Posted: 11 Apr 2019
Date Written: March 17, 2016
The purpose of this paper is to assess the strategies for improving the competitiveness of Ecuador (ECU), Colombia (COL) and Peru (PER). It is one of the first studies using 36 indicators within the context of three South-American countries. It fulfills the lack of knowledge at the scientific work and its practical objective by identifying the factors that public policy may take into consideration urgently to improve the global competitiveness level of the countries for a sustainable development and considerations for a long-term integration.
It analyzes data of four-year average of international sources such as: The International Monetary Fund, The World Bank, The United Nations, among others. The factors were selected after a careful literature review, the final selection and the weight of each determinant was calculated using partial least squares-structural equation modeling. The calculation of the national and international competitiveness indexes used the double diamond for competitiveness theoretical frame.
From a national perspective, it was found that COL is the most competitive country followed by PER in the second place and ECU is in third. Internationally, the authors have found also that COL is the most competitive economy, PER in second place and ECU is in third.
This study has found that in order to improve the level of national competitiveness, ECU has to concentrate on improving and strengthening formal and non-formal institutions, which are reflected in: four factors, PER four, and COL three. To reach international competitiveness, ECU should improve four factors, PER five, and COL five formal and non-formal institutions.
This research is the first one in its field, it uses 36 competitiveness indexes and the PLS-SEM statistic methodology to assign the weight of competitive indicators and the DD theoretical frame to determine the relevance of its factors and it is oriented to advise decision-makers and provides the appropriate police guidelines for the national competitiveness strategy and improve their quality of life of its residents from: ECU-COL-PER. On the other hand, the academic implications of these results appear when calculating the weight-load competitiveness indexes using inferential multivariate analysis; it provides researchers and practitioners an analysis tool for comparing competitive factors of emerging countries from the DD approach without any weaknesses, as a framework to assist in formulating economic policy at the national and regional level.
Due to the difficulty of competitiveness operationalization, this research uses PLS-SEM to correlate its factors as the statistical methodology and the DD as the tool for the identification of theoretical indicators. This work may be taken into consideration for an immediate and sustainable improvement in order to win competitiveness than its neighbors.
This study is unique because the factors were selected after a careful literature review; the final selection and the weight of each determinant was calculated using PLS-SEM. The calculation of the national and international competitiveness indexes used the DD for competitiveness theoretical framework applied for the first time in a research for South America with 36 determinants. The result of this analysis compares the weak and strong determinants of these three member countries of UNASUR for the development of their complementarities and therefore the recommendations of public policy.
Keywords: Latin America, emerging economies, competitiveness, PLS-SEM, international strategy
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