Microeconomics of competitiveness

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: excellent labor ­employer relations. The legal framework to settle disputes and enforce contracts is reliable, and there is little corruption. However, transparency in political decision ­making is below peer countries. FDI is at a low level, and there are weak incentives for employees to upgrade competence and productivity. As will be explored in greater detail, state ownership is a significant feature of the economy. Demand Conditions: The harsh winter conditions and mountainous terrain have forced innovation to overcome difficulties posed by nature, for example in the oil and gas industry or in promoting the use of ICT. The oil & gas cluster in Norway 8 Related and Supporting Industries and State of Cluster Development: The economy is less diversified than most developed economies, even those with comparable size. Figure 7 shows this low diversification graphically, along with stagnating export growth. Moreover, 3 natural resource ­based clusters are among the 5 largest clusters in terms of exports. A key tenet of the Norwegian government’s industrial policy is to build on existing strengths in developing a more knowledge ­based economy, though specific cluster policies do not appear to be sharply prioritized. Norway has some successful cluster programs (ARENA, NCE), led by Innovation Norway, the government agency for industrial development (Menon, 2011; Econ Poyri, 2011), and has developed a limited number of clusters that are competitive worldwide. Factor Conditions: Education Norway’s results in education do not match the level of expenditure, which is the 5th highest in Europe in terms of % of GDP (Eurostat, 2008). As shown in Figure 8, the scores in science, mathematics and...
View Full Document

This document was uploaded on 03/30/2014.

Ask a homework question - tutors are online