An analysis of growth competitiveness

Document Type

Article

Source of Publication

International Review of Applied Economics

Publication Date

1-1-2008

Abstract

The publication of the Global Competitiveness Report 2005-2006 by the World Economic Forum (WEF) (2005) has focused attention once more upon the relative abilities of many countries to compete in world markets. This article provides an analysis and evaluation of the approach taken by the WEF in constructing its measure of international growth competitiveness, the Growth Competitiveness Index (GCI) which is used to rank countries. In particular, the study identifies three areas where the GCI is vulnerable to criticism. First, the treatment of outliers for hard data items is ambiguous and we identify alternative methods for dealing with outliers that are justifiable or even superior. Second, the crucial role of the variable utility patents in the calculation of the GCI is questioned and serious doubts concerning the use of this variable are raised. Third, the article suggests an alternative approach, based upon structural equation modeling, which should be used for the determination of weights in the index calculation process, rather than the arbitrary method adopted by the WEF.

ISSN

0269-2171

Publisher

Informa UK Limited

Volume

22

Issue

1

First Page

105

Last Page

126

Disciplines

Business

Keywords

Growth Competitiveness Index, International growth competitiveness, Structural equation modeling, World Economic Forum

Scopus ID

38049065990

Indexed in Scopus

yes

Open Access

no

Link to Full Text

Share

COinS