Criterion of the Month archive
The World Competitiveness Newsletter is written by Professor Arturo Bris, Director of the IMD World Competitiveness Center, Dr Christos Cabolis, Chief Economist or Dr José Caballero, Senior Economist. It includes information drawn from the IMD World Competitiveness Yearbook.
We all strive for new beginnings and the start of a new year provides the best opportunity to align such deeds. It is manifested with the ancient tradition of making resolutions, promises that is, to align our behavior in such a way as to accomplish a positive target.
On January 29th, Transparency International released the Corruption Perceptions Index for 2018 revealing an alarming association between corruption and the level of democracy.
This is indeed what we ask the mid- and upper-level executives who receive our questionnaire around this time each year. You can imagine…The executives who decide to respond must reflect on what makes their economy attractive as a destination for capital, talent, as well as ideas.
Conquering space is a perennial aspiration of humans. From Daedalus and Icarus in the Greek mythology to “From the Earth to the Moon” and its sequel “Around the Moon” by Jules Verne in the mid-19th century, the narrative was always there: Capturing higher and higher distances from the earth and ultimately reaching to the moon. Yet it took about another century to make Jules Verne’s novel, a reality.
At the end of the month, the IMD World Competitiveness Center will launch the 2019 competitiveness rankings. Which economies do you think that will be in these three places in 2019?
On May 28, the IMD World Competitiveness Center launched the 2019 rankings. Singapore ranked as the world’s most competitive economy for the first time since 2010, Hong Kong remained in the second spot while the United States slipped from the spot.
The IMD World Talent Ranking captures a country’s efforts to develop local talent while being able to attract overseas staff. It describes the quality of the talent pool available in an economy. The ranking assesses 63 countries using three factors.
On September 26, we are launching the third edition of the IMD World Digital Competitiveness Ranking (WDCR). It assesses an economy’s aptitude to adapt and explore digital technologies that transform business models, government practices and the society in general.
2019 marked the 30th anniversary of the IMD World Competitiveness Center.
For the past 30 years, we have spearheaded research on how nations and enterprises compete to lay the foundations for future prosperity.
The competitiveness of nations is probably one of the most significant developments in modern management, and IMD intends to remain the leader in this field.
Now in its sixth year, the IMD World Talent Ranking scores countries across three factors of investment and development, readiness and appeal.
With the Holiday Season around the corner, wellbeing wishes for the New Year are in order. Paramount among them is “good health.” In fact, promoting healthy living is a prerequisite to enhancing prosperity, a point that is the focus of the third UN Sustainable Development Goal (UNSDG): “good health and well-being.”
Mrs. Angela Merkel, the Chancellor of Germany, has led her country in successful economic performance since she took office in 2005. Indeed, Germany exhibits increasing values in the traditional economic indicators.
Two years ago, the United Nations set a thought-provoking and aspiring agenda for sustainable development to be accomplished by 2030.
To celebrate the many accomplishments by women and acknowledge the on-going efforts for gender parity, this issue of the Criterion of the Month explores the evolution of three key areas of women participation and decision-making in the last decade.
| What makes countries happier?|
Research on what affects the levels of happiness of an individual, organization or country has been growing across different academic fields because of its importance to managers, business leaders and policy makers alike. The relationship between different measurements of income and happiness is multi-faceted.
In less than three weeks, the IMD World Competitiveness Center will launch the 2018 competitiveness rankings. Every year in May there is a lot of work and a tremendous effort to cope with deadlines, meticulous reporting and checking of the data. There is also excitement about the upcoming results. This year, the enthusiasm and anticipation are even higher because this year the Center will launch the 30th edition of the IMD World Competitiveness Yearbook!
The USA has always been in the top of the competitiveness ranking. Since 1997, US ranked first 16 times out of 22, and never below 4th. Thus, being in the top place is neither unfamiliar nor infrequent. Its strengths focus on two factors: economic performance and infrastructure. And in the current edition, these two factors were indeed the ones that were the highest ranked in the profile of the country.
The second edition of the IMD World Digital Competitiveness Ranking (WDCR)assesses the capacity of 63 economies to adapt and explore digital technologies. In this edition of the Criterion of the Month we will explore what is the correlation between the Future Readiness factor and indicators of productivity.
The issues of governance scandals and corporate control failures are perennial and persistent.In this edition of the criterion of the month we present the relationship between variables from our dataset that capture the perception on corruption and practices within firms.
The Brazilian voters casted their ballots in the first round of the presidential elections this past Sunday and will return for the final second round on October 28. There is a lot of interest and many articles in the popular press and social media about the election. Brazil is after all, the 5th country in the world by population and the 8th by GDP. In addition, following recent global trends, this election has been divisive and polarized.
Where to go on vacation?
December has arrived! And the winter holidays are just around the corner! A big part of the world celebrates, families and friends get together, communities convene to observe rituals and enjoy each other. An important part of these traditions is the exchange of presents. This is also the time when households decide to donate to charities, which focus on issues of their concern. It is not surprising that non-profit organizations intensify their appeals for donations to interested individuals and philanthropy funds. After all, giving and sharing is the underlying principle of the season.
Why do MNCs such as Philip Morris and ABB choose Switzerland as a base for their operations? There are several significant factors that define the attractiveness of Switzerland.
The actions and policies of government and their outcomes (e.g., infrastructure indicators) affect the efficiency and productivity of the private sector. In this Criterion of the Month, we assess some of the key indicators driving business efficiency and productivity.
March 8 marks International Women’s Day: a celebration of the many accomplishments by women as well as the acknowledgement of on-going efforts for gender parity in the social, political and economic spheres. In this issue of the Criterion of the Month, the IMD World Competitive Center recognizes the International Women’s Day by exploring the relationship between competitiveness and different criteria related to women’s activities.
April 23 is the first round of the French Presidential election. As with many recent elections, there is an intense interest in the outcome, especially with Le Pen as a contender and with Trump and Brexit still making daily headlines.
Technology changes at great speed and affects not only how businesses function but also how countries perform today and evolve in the future. From 3D-printing, robotics, and neuro-technology to digital-currencies and e-participation the landscape of current capabilities and future prospects changes swiftly. In order for the decision makers in both public and private sectors of an economy to address this rapid transformation, it needs to be quantified and accounted for.
The new ranking recently released by the IMD World Competitiveness Center prompts to a host of different inquiries, particularly with respect to the new criteria utilized.
It is a little more than a year since Britain surprised pundits and analysts by voting to exit the European Union. In the last few months, economic and financial publications have been comparing the evolution of different dimensions of the economy. The general picture is not encouraging with consumer prices rising above the Bank of England’s target, real weekly earnings decreasing, and the pound declining in comparison to the dollar and other currencies.
In this Criterion of the Month, we continue to explore the relationship between business efficiency and productivity, and the institutional framework.
September marks the beginning of the academic year for most of the northern hemisphere. It is the time to make decisions over what courses to take and which disciplines to study.
Transparency on the government level has been a key issue for more than a decade. Theoretical and empirical work along with the advocacy of NGOs have strengthened the idea, have suggested ways to measure it, and have kept the issue on the forefront of any discussion about the necessary conditions that a high-quality government must follow.
How open an economy is affects its size and the level of competitivenessof the country. The free flow of goods and services, talent, and ideas benefits economies in many ways from making them more efficient to transferring know-how, to facilitating the adoption of new technologies.
eflecting on the popular topics for 2017, two themes stand out among those which captured the interest of researchers and commentators. First, the extent to which economies successfully address the future loss of employment due to the introduction of new technologies; and second, the benefits associated with the general concept of globalization.
In the 2015 IMD World Competitiveness Executive Survey, we asked our executives to predict their country’s stock market performance for the year. This was a pioneering study trying to assess the forecasting ability of business executives, or alternatively the importance of sentiment in stock markets.
The IMD World Competitiveness Center recently partnered with Accenture (Germany and Switzerland) to conduct a study about digitization trends and the digital challenges that German and Swiss companies are facing. The study incorporates 247 survey responses from German executives and 396 responses from Swiss executives. We assess the impact of digitization on the competitive context and the digital practices that the competitive firms adopt in such environments.
The IMD World Competitiveness Center in partnership with Thailand’s Department of Trade Negotiations (Ministry of Commerce) recently organized an event aimed at improving Thailand’s competitiveness. The three-day event included several interrelated activities and culminated in a highly dynamic and interactive workshop – a “Mega Dive.”
Data show that a structural transformation is a precondition for increasing competitiveness. Such transformation entails enabling all individual members of society to fully participate and contribute to economic activities.
The USA has surrendered its status as the world’s most competitive economy after being overtaken by China Hong Kong and Switzerland, according to the IMD World Competitiveness Center.
There are certain particularities that underline the competitiveness of countries. We consider these characteristics as attractiveness indicators and asked respondents to our Executive Opinion Survey to select the top five indicators (from a list of 15) for their respective economies.
Following up on feedback from several readers, in this criterion of the month we explore the IMD World Competitiveness Ranking’s core components: its hard and survey data elements.
Using the IMD World Competitiveness Yearbook’s data for 2016, we develop a measure of Digital Competitiveness; that is, the adequacy of the different components of an economy’s structure for facilitating its digitalization.
A major global study has identified crisis-riddled Europe as home to nine of the 10 economies best equipped to develop, attract and retain business talent.
At first glance, it seems obvious that brain drain is a significant cost to emerging economies. However, some academic observers (e.g., Mountford, 1997; Beine, Docquier and Rapoport, 2001) have argued that brain drain is beneficial. They posit that the possibility of migration encourages investment in education because of the potential high returns abroad from educated migrants. Arguably, brain drain can thus eventually increase income equality in the country of origin.
The latest currency fluctuation wave in Europe will indeed impact several competitiveness criteria. In terms of the World Competitiveness Yearbook hard statistics, such an impact will be felt in the long-term. Changes in exchange rates will resonate, for example, in indicators such as stock prices and export sales for 2016 (if not later).
Concepts and ideas “travel” (Said, 1983). These building blocks of intellectual activity reflect existing societal conditions. Initial circumstances, however, evolve, and thus concepts and ideas come under scrutiny—what was an appropriate understanding of specific historical conditions enters a reinterpretation phase.
Competitiveness is dynamic. Such nature makes it necessary to constantly incorporate new indicators to ensure the continuous relevance of our research. In preparation for the upcoming Yearbook we have therefore initiated the review of the current criteria employed to assess competitiveness. Although our list of indicators provides a robust view of the competitiveness of countries, we feel the need to strengthen specific aspects of the analysis. Below we detail the new criteria being considered for the 2015 Yearbook.
The USA continues to top the ranking; Asia experiences mixed results; and large emerging economies mostly linger.
Our recently published 2015 World Competitiveness Ranking reiterated the fundamental role of business efficiency in driving country competitiveness: nine out of the top 10 countries from the overall ranking achieved a top-10 position in the business efficiency factor. By business efficiency we mean the extent to which the national environment encourages enterprises to perform in an innovative, profitable and responsible manner. Essential to business efficiency is company agility: the ability of companies to adapt to changes through the adoption of proactive practices and behaviors that lead to sustainable value creation.
In our previous Criterion of the Month (June 2015), we invited you to complete our Business Competitiveness survey. We take this opportunity to share the highlights of the survey results. We received 67 responses representing 67 companies from a range of industries including manufacturing, mining, pharmaceutical, communications and the financial sector. There are 23 countries represented in the sample including Azerbaijan, Brazil, Denmark and Thailand.
Competitiveness greatly depends on the extent to which governments facilitate an environment conducive to business. One key indicator in this dimension is the impact of immigration laws; that is, whether or not immigration laws curtail the ability of enterprises to conduct their activities effectively. We partly capture the effect of stricter immigration policies through the IMD World Competitiveness Center's executive opinion survey, designed for the IMD World Competitiveness Yearbook.
The IMD World Competitiveness Center is delighted to present its IMD World Talent Report 2015. The report includes a talent ranking for all countries that are part of the IMD World Competitiveness Yearbook (61 countries as of this year). The data are gathered from the Center’s extensive database, which encompasses 20 years of competitiveness-related data. All data employed in the development of the report can be accessed through the World Competitiveness Online website.
Most countries complain that “under education” is a major hindrance to their competitiveness. The latest PISA report conducted by the OECD outlines again the strong performance of Korea, part of China, Switzerland and Finland on students achievement in sciences. The criterion of this month corroborates the same trends, although taking a wider scope on education and competitiveness. But could “better” be an issue? Are we now – sometimes – overeducating the next generation?
The turbulences in currency markets these past weeks highlight once more the importance of macroeconomic factors on corporate performance. This time, triggered by a devaluation of the Argentinean peso, which had been artificially pegged to the dollar, a mild contagion spread, first to Latin America, and then to the rest. For firms with economic ties to the region, the volatility of emerging market currencies had a negative effect on stock returns.
Moreover, what has been the impact of the financial crisis on the attention that governments have given to medical care to the population?
"The overall competitiveness story for 2014 is one of continued success in the US, partial recovery in Europe, and struggles for some large emerging markets,” said Professor Arturo Bris, Director of the IMD World Competitiveness Center. “There is no single recipe for a country to climb the competitiveness rankings, and much depends on the local context.”
Is there a relationship between political systems and competitiveness? Does democracy helps or hinders competitiveness? These are recurrent questions in our discussions with executives and politicians worldwide. Let us try to provide some insights on this issue.
The executive survey employed in the development of the IMD world competitiveness ranking entices executives to reflect about the level (whether they consider it high or low) of their country’s quality of life. Intuitively one may conclude ex ante that the GDP of a particular country determines its quality of life. And yet, as we will observe shortly, GDP cannot fully explain certain patterns in the data.