International Competitiveness: Implications of New International Economics
This chapter aims to provide a perspective on the desirability of industrial policy options as an aid to promoting a country’s competitiveness. J. Fagerberg’s econometric results appear to accord with more casual observation of the competitive challenges facing the United States’ economy. The ultimate aim of “managed trade” would be to promote US access to overseas markets in return for continued, but controlled access to the US market. Others have called for internal measures to increase the US ability to compete in high technology industries. The US productivity slowdown has largely been associated with low investment, investment in the United States as a proportion of gross domestic product over 1970 to 1980 being lower than in most other industrialized countries. Evidence shows that government funding of research and development in Japan is lower than in other major industrialized countries.