Bakı Dövlət Universiteti

Competitiveness improves when productivity rises relative to costs. However, when competitiveness is achieved through cost cutting alone it cannot be sustained for long. Companies and countries which rely on low-cost input find their competitive position challenged by a new low-cost competitor or a new technology. Countries can only continue to offer cheap labor by keeping living standards low. However, rising pro­ductivity keeps prices competitive and living standards high. That is why productivity, driven by high skills and advanced technology, is the main paradigm of competitiveness today. Therefore, high competitiveness is the result of the quality of national policies and institutions, which also means that nations do compete. In this context it would be useful to consider the institutional framework for national competitiveness. We will refer to the concept of systemic competitiveness developed by Esser et al.Industrial competitiveness is the result of complex and dynamic interactions between factors at four social and economic levels: the meta, macro, meso and micro levels. At meta level are the socio-economic, cultural and political factors essential to competitiveness. These are cultural values such as the social recognition of achievement, positive work ethics, propensity to save, long-term investment in education and training, consensus on the necessity of industrial development and integration into world markets and the ability of the social actors to jointly formulate visions and strategies.