Traditional economic theory states that a country ‘inherits’ a comparative advantage over other countries in particular industries because of the natural resources that it enjoys.
Natural resources include not only land and mineral deposits, but also the labour force and size of the population.
Michael Porter challenged the traditional theory of comparative national advantage in his book “The Competitive Advantage of Nations”. He put forward a different theory of national competitive advantage, known as Porter’s Diamond.
Porter argued that the national domestic market plays an important role in creating competitive advantage for companies on a global scale.
In Nigeria for example, there has been a low competition in Nigerian products due to the inferior quality of products produce by Nigerian industries. This has impacted negatively on Nigerian market which foreign products are more patronise than the home made products.
Continue reading THE REASONS FOR NATIONAL COMPETITIVE ADVANTAGE AND THE FUTURE OF NIGERIAN INDUSTRIES.