IDEAS home Printed from https://ideas.repec.org/a/rfe/zbefri/v35y2017i1p123-150.html
   My bibliography  Save this article

Contemporary approaches to measuring competitiveness – the case of EU member states

Author

Listed:
  • Alemka Šegota

    (Faculty of Economics,University of Rijeka, Rijeka, Croatia)

  • Marko Tomljanoviæ

    (Faculty of Economics,University of Rijeka, Rijeka, Croatia)

  • Ivona Huðek

    (Faculty of Economics,University of Rijeka, Rijeka, Croatia)

Abstract

Competitiveness represents a concept that has occupied a great deal of the economic theorists’ attention for decades. Due to its complexity and different perceptions, it has not been uniquely defined yet and neither has its measurement system been completely developed. The problem of the conducted research arises from the fact that the countries mostly due to structural and other constraints in the economy (or in cases where they have high levels of GDP) do not use the available inputs in the best way, i.e. they do not achieve a satisfactory level of economic efficiency, which is then reflected on the competitiveness of their economies. The aim of the research paper is to demonstrate how a combination of using Data Envelopment Analysis Method (DEA) and the Global Competitiveness Index (GCI) in ranking the countries according to the macroeconomic competitiveness is more realistic than it is in the case of using the traditional indicators. In the paper, in evaluating the competitiveness of selected EU Member States the Data Envelopment Analysis Method (DEA) is used. Based on the previous researches and our research results it is found that the traditional indicators of competitiveness are incomplete because they do not consider the macroeconomic efficiency of the country. Therefore, we propose to apply a combination of GCI and the efficiency results obtained by DEA in order to achieve a more realistic evaluation of macroeconomic competitiveness. As a key outcome of the research, the new measure of competitiveness is proposed: a combination of traditional competitiveness indicator and the results of the evaluation of countries’ macroeconomic efficiency obtained by applying BCC model of DEA method.

Suggested Citation

  • Alemka Šegota & Marko Tomljanoviæ & Ivona Huðek, 2017. "Contemporary approaches to measuring competitiveness – the case of EU member states," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 35(1), pages 123-150.
    • Handle: RePEc:rfe:zbefri:v:35:y:2017:i:1:p:123-150
    as

    Download full text from publisher

    File URL: https://www.efri.uniri.hr/sites/efri.uniri.hr/files/cr-collections/2/06-segota-tomljanovic-hudjek-2017-1.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Philippe Aghion & Nick Bloom & Richard Blundell & Rachel Griffith & Peter Howitt, 2005. "Competition and Innovation: an Inverted-U Relationship," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(2), pages 701-728.
    3. Aizenman, Joshua & Pinto, Brian & Radziwill, Artur, 2004. "Sources for Financing Domestic Capital – is Foreign Saving a Viable Option for Developing Countries?," Santa Cruz Department of Economics, Working Paper Series qt31n8m3bt, Department of Economics, UC Santa Cruz.
    4. Guan, Jian Cheng & Yam, Richard C.M. & Mok, Chiu Kam & Ma, Ning, 2006. "A study of the relationship between competitiveness and technological innovation capability based on DEA models," European Journal of Operational Research, Elsevier, vol. 170(3), pages 971-986, May.
    5. George Emm. Halkos & Nickolaos G. Tzeremes, 2007. "International Competitiveness in the ICT Industry: Evaluating the Performance of the Top 50 Companies," Global Economic Review, Taylor & Francis Journals, vol. 36(2), pages 167-182.
    6. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    7. Aizenman, Joshua & Pinto, Brian & Radziwill, Artur, 2007. "Sources for financing domestic capital - Is foreign saving a viable option for developing countries?," Journal of International Money and Finance, Elsevier, vol. 26(5), pages 682-702, September.
    8. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    9. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    10. Krugman, Paul R, 1996. "Making Sense of the Competitiveness Debate," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 12(3), pages 17-25, Autumn.
    11. Jadranka Å varc, 2014. "A Triple Helix systems approach to strengthening the innovation potential of the Western Balkan countries," International Journal of Transitions and Innovation Systems, Inderscience Enterprises Ltd, vol. 3(3), pages 169-188.
    12. Marko Djogo & Marko Nenad Stanisic, 2016. "Is the Global Competitiveness Report the right measure of macroeconomic competitiveness," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 34(1), pages 91-117.
    13. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Manuel Carlos Nogueira & Mara Madaleno, 2021. "Are International Indices Good Predictors of Economic Growth? Panel Data and Cluster Analysis for European Union Countries," Sustainability, MDPI, vol. 13(11), pages 1-24, May.
    2. Stanković Jelena J. & Džunić Marija & Milić Vesna Janković, 2019. "Competitiveness and the EU Accession Process: Can Candidate Countries Become Competitive as EU Countries?," Economic Themes, Sciendo, vol. 57(4), pages 415-432, December.
    3. Idris, Zera Zuryana & Ismail, Normaz Wana & Ibrahim, Saifuzzaman & Hamzah, Hanny Zurina, 2021. "High-Technology Trade: Does it Enhance National Competitiveness?," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 55(3), pages 35-48.
    4. Elena Fifeková & Eduard Nežinský & Edita Nemcová, 2018. "Global Competitiveness of Europe: A Robust Assessment," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 4, pages 245-260, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Naeem AKRAM*, 2017. "Role of Public Debt in Economic Growth of Sri Lanka: An ARDL Approach," Pakistan Journal of Applied Economics, Applied Economics Research Centre, vol. 27(2), pages 189-212.
    2. Jiancheng Guan & Kairui Zuo, 2014. "A cross-country comparison of innovation efficiency," Scientometrics, Springer;Akadémiai Kiadó, vol. 100(2), pages 541-575, August.
    3. Kumar, Sanjesh & Singh, Baljeet, 2019. "Barriers to the international diffusion of technological innovations," Economic Modelling, Elsevier, vol. 82(C), pages 74-86.
    4. Wang, Lan-Hsun & Liao, Shu-Yi & Huang, Mao-Lung, 2022. "The growth effects of knowledge-based technological change on Taiwan’s industry: A comparison of R&D and education level," Economic Analysis and Policy, Elsevier, vol. 73(C), pages 525-545.
    5. Rafiou Raphaël Bétila, 2021. "The impact of Ease of Doing Business on economic growth: a dynamic panel analysis for African countries," SN Business & Economics, Springer, vol. 1(10), pages 1-34, October.
    6. Aghion, Philippe, 2002. "Les défis d’une nouvelle théorie de la croissance," L'Actualité Economique, Société Canadienne de Science Economique, vol. 78(4), pages 459-486, Décembre.
    7. Gros, Daniel & Alcidi, Cinzia, 2014. "The Global Economy in 2030: Trends and Strategies for Europe," CEPS Papers 9142, Centre for European Policy Studies.
    8. Rehme, Günther, 2007. "Wissen und Neue Wachstumstheorie: Die Rolle von fachspezifischem Humankapital," Darmstadt Discussion Papers in Economics 189, Darmstadt University of Technology, Department of Law and Economics.
    9. Andre Jungmittag, 2007. "Innovationen, Beschäftigungsstruktur und Wachstum der totalen Faktorproduktivität," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 27(2), pages 143-170, August.
    10. Yang Li & An-Chi Liu & Shu-Mei Wang & Yiting Zhan & Jingran Chen & Hsiao-Fen Hsiao, 2022. "A Study of Total-Factor Energy Efficiency for Regional Sustainable Development in China: An Application of Bootstrapped DEA and Clustering Approach," Energies, MDPI, vol. 15(9), pages 1-13, April.
    11. Jens Kaüger & Uwe Cantner & Horst Hanusch, 2000. "Total factor productivity, the east Asian miracle, and the world production frontier," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 136(1), pages 111-136, March.
    12. Malcolm Abbott, 2018. "Productivity: a history of its measurement," HISTORY OF ECONOMIC THOUGHT AND POLICY, FrancoAngeli Editore, vol. 2018(1), pages 57-80.
    13. Kairui Zuo & Jiancheng Guan, 2017. "Measuring the R&D efficiency of regions by a parallel DEA game model," Scientometrics, Springer;Akadémiai Kiadó, vol. 112(1), pages 175-194, July.
    14. Dimitris KALLIORAS & Nickolaos TZEREMES & Panayiotis TZEREMES & Maria ADAMAKOU, 2021. "Technological Change, Technological Catch-Up And Market Potential: Evidence From The Eu Regions," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 0(1), pages 135-151, June.
    15. Peter Howitt, 2004. "Endogenous Growth, Productivity and Economic Policy: A Progress Report," International Productivity Monitor, Centre for the Study of Living Standards, vol. 8, pages 3-15, Spring.
    16. M. Danquah & B. Ouattara, 2014. "Productivity Growth, Human Capital And Distance To Frontier In Sub-Saharan Africa," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 39(4), pages 27-48, December.
    17. Po-Chin Wu & Tzu-Hsien Huang & Sheng-Chieh Pan, 2014. "Country Performance Evaluation: The DEA Model Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 118(2), pages 835-849, September.
    18. Gilbert Cette & Anne Epaulard & Pauline Givord, 2008. "Croissance de la productivité : le rôle des institutions et de la politique économique," Économie et Statistique, Programme National Persée, vol. 419(1), pages 3-10.
    19. Furceri, Davide & Karras, Georgios, 2007. "Country size and business cycle volatility: Scale really matters," Journal of the Japanese and International Economies, Elsevier, vol. 21(4), pages 424-434, December.
    20. Butkiewicz, James L. & Gordon, Leo-Rey C., 2013. "The Economic Growth Effect of Offshore Banking in Host Territories: Evidence from the Caribbean," World Development, Elsevier, vol. 44(C), pages 165-179.

    More about this item

    Keywords

    Data Envelopment Analysis (DEA); EU; efficiency; inefficiency; macroeconomic competitiveness;
    All these keywords.

    JEL classification:

    • F00 - International Economics - - General - - - General
    • F6 - International Economics - - Economic Impacts of Globalization

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rfe:zbefri:v:35:y:2017:i:1:p:123-150. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Danijela Ujcic (email available below). General contact details of provider: https://edirc.repec.org/data/efrijhr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.