authors : Hyun-Sung Cho, Dae-Wook Kim(Industrial Competitiveness Division)

1. Introduction
The concept of “competitiveness” came into widespread use through the works of Michael Porter. The term was initially used as a micro concept to evaluate the management capabilities of a company, but was later expanded to encompass the competitive abilities of industries and countries, with increasing interest in the macroscopic environment regarding corporate management.
While research regarding industrial and national competitiveness continues, the debate on the limitation of the concept and analysis remain unresolved. While some evaluate national competitiveness as a useful tool that can describe a comprehensive indicator of the characteristics of a country`s economic structure, others, like Krugman, assert that it is meaningless to evaluate a country through a one-dimensional index, since the objectives of countries are different from those of companies. Despite criticism and debate regarding the indexing of competitiveness, a continuing demand for national and industrial competitiveness indexes has maintained the steady flow of research into the subject. This has been followed by improved methodologies in competitiveness analysis and an accumulation of researches.
The IMD (International Institute for Management Development), which publishes the World Competitiveness Yearbook (WCY), defines national competitiveness as “the ability of a nation to create and maintain an environment that sustains more value creation for its enterprises...” However, this definition of competitiveness cannot be viewed as universal, and is subject to vary depending on the objectives of each individual research. Likewise, a unified definition of industrial competitiveness does not exist. This is one of the most difficult aspects of competitiveness analysis...