This is a template for instructors to create a Course Syllabus (Study Plan) that fulfils the Clark
University requirements. Instructors have freedom to design their own plan, as long as it includes
the necessary elements as described below.
COURSE SYLLABUS
«MICROECONOMICS OF COMPETITIVENESS»
MSPC 3440
Spring 2014
Course Description
The Microeconomics of Competitiveness is a distinctive course platform developed at Harvard by
Professor Michael Porter and a team of colleagues that is designed to be taught in collaboration with
universities around the world. It is designed to be taught to graduate students in business, economics,
development, government, and related disciplines.
This course on competitiveness and economic development addresses the subject from a bottom-up,
microeconomic perspective missing in most traditional development courses. The course is not only
an educational vehicle but also a tool to enable a university to influence and support economic
development in its country and region. In addition to training future leaders of business and
government in competitiveness concepts, the course can be adapted for executive programs. It can
become a focal point for projects and initiatives that engage the university in economic policy and
business development with government and the private sector. The ultimate vision of the course is to
make a meaningful impact on the economic competitiveness and prosperity of the countries in which
it is taught.
Course Objectives
This course explores the determinants of national and regional competitiveness building from the
perspective of firms, clusters, subnational units, nations, and groups of neighboring countries. It
focuses on the sources of national or regional productivity, which are rooted in the strategies and
operating practices of locally based firms, the vitality of clusters, and the quality of the business
environment in which competition takes place.
This course examines both advanced and developing economies and addresses competitiveness at
multiple levels – nations, subnational units such as states or provinces, particular clusters, and
neighboring countries. The course is concerned not only with government policy but also with the
roles that firms, industry associations, universities, and other institutions play in competitiveness. In
modern competition, each of these institutions has an important and evolving role in economic
development. Moreover, the process of creating and sustaining an economic strategy for a nation or
region is a daunting challenge. The course explores not only theory and policy but also the
organizational structures, institutional structures, and change processes required for sustained
improvements in competitiveness.
Reading materials
5.1. BASIC MATERIALS:
1. Porter, Michael E. On Competition. A Harvard Business Review Book. – 1998. (Портер М.
Конкуренция./Пер. с англ.: Учебное пособие. – М.: Издательский дои «Вильямс», 2000.)
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2. Porter, Michael E The competitive advantage of nations: with a new introduction. Originally
published: New York: Free Press, 1990. (Портер М. Международная конкуренция: Пер. с
англ./Под ред. и с предисловием В.Д. Щетинина. - М.: Междунар. отношения, 1993.)
3. REQUIRED CASES:
 Finland and Nokia: Creating the Most Competitive Economy
 Intel Corporation, 1968-1997
 Volvo Trucks: Penetrating the U.S. Market
 The Japanese Facsimile Industry in 1990
 Estonia in Transition
 Chile: The Latin American Tiger?
 The California Wine Cluster
 The Australian Wine Cluster: Supplementary Information
 Building a Cluster: Electronics and Information Technology in Costa Rica
 Institutions for Collaboration: Overview
 Asociacion Colombiana de Plasticos (Acoplasticos)
 Centre Susse d’Electronique et de Microtechique (CSEM)
 Singapore Economic Strategy: Independence to 1992
 Rwanda: National Economic Transformation
 The State of Connecticut: Strategy for Economic Development
 Central America: Strategy for Economic Integration
5.2. ADDITIONAL SOURCE MATERIALS:
1.Кныш М.И. Конкурентные стратегии.– СПб., 2000.
2.Портер М. Конкурентная стратегия: Методика анализа отраслей и конкурентов. Пер. с англ.
– 2-е изд. – М.: Альпина Бизнес Букс, 2006.
3.Портер Майкл Е. Японская экономическая модель: Может ли Япония конкурировать? /
Майкл Портер, Хиротака Такеути, Марико Сакакибара. Пер. с англ. – М.: Альпина Бизнес
Букс, 2005.
4.Фатхутдинов Р.А. Конкурентоспособность: экономика, стратегия, управление. – М, 2000.
5.Печаткин В.В., Салихов С.У., Саблина В.А. Рейтинговая оценка конкурентоспособности
регионов России. — Уфа, 2004.
5.3. SELECTED REFERENCES:
 "Competitiveness in Rural U.S. Regions: Learning and Research Agenda", with Christian
Ketels, Kaia Miller, and Rich Bryden, Economic Development Administration (EDA),
Washington, D.C., April 2004
 "The Economic Performance of Regions". Regional Studies, Vol. 37, 2003
 "UK Competitiveness: Moving to the Next Stage", with Christian Ketels, DTI Economics
Papers, No.3, London: 2003
 "The Competitive Advantage of Corporate Philanthropy." with Mark Kramer, Harvard
Business Review, December 2002
 "Building the Microeconomic Foundations of Prosperity: Findings from the Microeconomic
Competitiveness Index" in The Global Competitiveness Report 2005-06. Palgrave Macmillan
, 2005
 "Building the Microeconomic Foundations of Prosperity: Findings from the Microeconomic
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Competitiveness Index" in The Global Competitiveness Report 2002-03. New York: Oxford
University Press, New York: Oxford University Press, 2002
"Clusters of Innovation Initiative: Research Triangle Report," (with the Council on
Competitiveness, Monitor Group, and on the FRONTIER), Washington, DC: Council on
Competitiveness, 2002
"Clusters of Innovation Initiative: Pittsburgh Report," (with the Council on Competitiveness,
Monitor Group, and on the FRONTIER), Washington, DC: Council on Competitiveness,
2002
"Clusters of Innovation Initiative: Atlanta Report," (with the Council on Competitiveness,
Monitor
Group, and on the FRONTIER), Washington, DC: Council on Competitiveness, 2002
"Clusters of Innovation Initiative: Wichita Report," (with the Council on Competitiveness,
Monitor Group, and on the FRONTIER), Washington, DC: Council on Competitiveness,
2002
"Enhancing the Microeconomic Foundations of Prosperity: The Current Competitiveness
Index" in The Global Competitiveness Report 2001-02, New York: Oxford University Press,
2001
"Innovation Lecture." published by the Dutch Ministry of Economics, 2001
"National Report: Clusters of Innovation Initiative." (with the Council on Competitiveness,
Monitor Group, and on the FRONTIER), Washington, DC: Council on Competitiveness,
2001
"Clusters of Innovation Initiative: San Diego Report." (with the Council on Competitiveness,
Monitor Group, and on the FRONTIER), Washington, DC: Council on Competitiveness,
2001
The Current Competitiveness Index: Measuring the Microeconomic Foundations of
Prosperity" in The Global Competitiveness Report 2000-01. New York: Oxford University
Press, 2000
"Location, Competition, and Economic Development: Local Clusters in a Global Economy,"
(Economic Development Quarterly. February 2000,15-34)
"Locations, Clusters, and Company Strategy" in The Oxford Handbook of Economic
Geography. (G. L. Clark, M.P. Feldman, and M.S. Gertler, eds.), New York: Oxford
University Press, 2000
"Attitudes, Values, Beliefs and the Microeconomics of Prosperity," in Culture Matters: How
Values Shape Human Progress. (L.E. Harrison, S.P. Huntington, eds.), New York: Basic
Books, 2000
"Clusters and the New Competitive Agenda for Companies and Governments" in On
Competition, Boston; Harvard Business School Press, 1998
The Competitive Advantage of Nations, New York: The Free Press, 1990
5.5. WEB RESOURCES.
Institute for Strategy and Competitiveness
ISC Cluster Mapping Data (US)
ISC Cluster Profiles Project (ex-U.S.)
International Cluster Competitiveness Project
The Competitiveness Institute
Cluster of Innovation Initiative
www.isc.hbs.edu
http://data.isc.hbs.edu/isc/
http://data.isc.hbs.edu/cp/
http://data.isc.hbs.edu/iccp/
www.competitiveness.org
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- Council on Competitiveness
- Monitor Company
www.compete.org
www.monitor.com
5.6. ONGOING EMPIRICAL RESEARCH
Business Environment quality
• Continuous upgrading of data on national business environments
Global Competitiveness Report (www.weforum.org)
• Collection of data on regional U.S. business environments
Clusters of Innovation-Initiative (www.compete.org)
Weekly Assignment Schedule
Module
Date
Part
I: 10/02/14
Firms,
Industries
17/02/14
and CrossBorder
Competition 24/02/14
Part
II: 03/03/14
Locations
and
Clusters
10/03/14
17/03/14
24/03/14
Sessions
Competitiveness: Overall
Framework
Industry
Competition,
Strategy, and Location
Case Study
 Finland and
Nokia
 Intel Corporation,
1968-1997
Competing
Across
Locations
&
Global
Strategy for MNCs
The Diamond Model:
Advanced Economies
 Volvo Trucks
(A): Penetrating the
U.S. Market
 The Japanese
Facsimile Industry
in 1990
The Diamond Model:  Estonia in
Developing/Transition
Transition
Counties
 Chile: The Latin
American Tiger?
Clusters and Cluster  The California
Development: Advanced Wine Cluster
Economies
 The Australian
Wine Cluster:
Supplementary
Information
Clusters in Developing  Building a
Countries
Cluster: Electronics
and Information
Technology in
Costa Rica
Readings
 On Competition.
Chapters 1, 6, 7.
 On Competition.
Chapters 2, 5.
Review Chapter 1.
 On Competition.
Chapters 8, 9.
 Can Japan
Compete? Chapters
2, 3.
 On Competition.
Review Chapter 6.
 On Competition
Review Chapter 7.
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31/03/14
Part
III: 07/04/14
Policy for
Nations and
Regions
14/04/14
Part
IV: 11/03/14
Project
25/03/14
21/04/14
28/04/14
Control
for  Asociacion
Colombiana de
Plasticos
(Acoplasticos)
 Centre Susse
d’Electronique et de
Microtechique
(CSEM)
 Institutions for
Collaboration:
Overview
Economic
Strategy:  Singapore
Advanced Economies
Economic Strategy:
Independence to
1992
Economic
Strategy:  Rwanda:
Developing Economies
National Economic
Transformation
Project methodology
Institutions
Collaboration
Mid-term report, further
analysis
and
recommendation
Presentation draft
Presentation
feed-back
presentation,
submitted
to
class,
on
report
Team project
Part I: Firms, Industries and Cross-Border Competition
1. Competitiveness: Overall Framework
Introductory session. Provide an overview of the topics covered in the course. Introduce the different
dimensions affecting competitiveness: nations, cluster, and company levels.
Case 1. Finland and Nokia: Creating the Most Competitive Economy.
How was Finland as a nation able to move form a sleepy economy to a one of the most competitive
nations in the world by the end of the 1990s? Why was Finland able to become a world-leading
nation in mobile communication? Why did this cluster emerge rather than others? Why did Nokia
become the world leader in mobile handsets? What are the critical challenges for the Finish
government in 2001? For participants in the finish mobile communications cluster? For Nokia?
Given the telecom downturn, what should the government do next? What should the private sector
do?
2. Industry Competition, Strategy, and Location
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First session of the module on company strategy and location. Provide a grounding in key strategy
concepts, especially for students with less business background. Link traditional strategy concepts to
the notion of location. Again motivate students by providing more in-depth knowledge and
understanding about a well-known success case.
Case 2. Intel Corporation, 1968-1997.
Why was Intel initially successful in DRAMs? How did Japanese companies come to be the
international leaders in this business? Why couldn’t Intel (or other American companies) recover?
How did Intel build a competitive advantage in microprocessors? How has the company managed to
sustain the advantage over time? Why did U.S. companies dominate the microprocessors business
from the beginning, with Japan unable to gain a major position? What explains the different
outcomes in the DRAM and microprocessors industries? What are the lessons for government
economic policy?
3. Competing Across Locations & Global Strategy for MNCs
Second session of the module on company strategy and location. Provide a grounding in key
concepts of international business, including the differences between national and global industries.
Provide a grounding in key concepts of industry attractiveness analysis (Five Forces), especially for
students with less business background. Company and industry might be less well known, so this can
give all students and equal opportunity to get engaged in the discussion based on the information in
the case only.
Case 3. Volvo Trucks (A): Penetrating the U.S. Market.
How has Volvo configured its value chain for competing in the worldwide heavy truck industry? Be
specific. Which activities are concentrated? Which activities are dispersed? Why? Where has Volvo
located each type of activity and why? Why are European-based competitors the global leaders? Why
is Volvo so committed to entering the U.S. market? What approach has Volvo taken towards
establishing itself in the United States? Evaluate each step. Why has Volvo had so much difficulty?
What should Volvo do in 2000? What are the implications of the Volvo case for how countries should
attract foreign investment?
Part II: Locations and Clusters
4. The Diamond Model: Advanced Economies
First session of the business environment module. Introduce the diamond, the first key concept of the
competitiveness analysis. Use a “historic” case where the outcome is known to all students to allow
the discussion to focus on the application of the concept. Open for a discussion of the “Japanese
model”, especially the impact of so-called industrial policy on the success of Japanese clusters.
Case 4. The Japanese Facsimile Industry in 1980.
Why did companies based in Japan come to dominate the world facsimile machine industry, and
sustain their leadership? How is the fax case similar to. and different from, the case of mobile
communications in Finland? What caused leadership in the Japanese industry to shift from
Matsushita to Ricoh to Sharp/Murata? Why did U S. firms, where the technology was invented, lose
out in this industry? Why were the French not successful? What threats lie ahead to Japan's
leadership in facsimile machines in the new century? What should the Japanese government do?
What should companies do? Reflect on this case, as well as Finland/Nokia, and Volvo. What are the
lessons for government policy to enhance competitiveness? What works? What does not work?
5. The Diamond Model: Developing/Transition Counties.
Second session of the business environment module. Deepen the understanding of the diamond
concept by applying it in the context of transition/developing economies. Learn to use the diamond
as a tool to compare countries, getting students to understand that while the concept is the same the
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resulting policy agenda is very country-specific. Use cases from very different geographic and
historic/political contexts to show the wide applicability of the concept. Raise students’’ interest by
providing information about potentially less known countries.
Case 5. Estonia in Transition.
Chile: The Latin American Tiger?
How has Estonia been able to achieve such competitive success compared to other transition
countries? - What were the important changes in the macroeconomic, political, legal and social
context? How has the national diamond progressed? How was Estonia able to make so many difficult
changes and progress so rapidly? Compare Estonia's success with that of Chile. What эге the
similarities? What are the differences? Which country faced greater challenges? What are the
competitiveness issues facing Estonia in 2002? What recommendations would you make to Estonia's
leaders?
6. Clusters and Cluster Development: Advanced Economies
First session of cluster module. Introduce the cluster, the second key concept of the competitiveness
analysis. Use a well-known product and cluster where the outcome is known to all students to allow
the discussion to focus on the application of the concept. Use an example not mentioned as often
publicly (versus Silicon Valley, Wall Street, or Hollywood) to show the broad applicability of the
concept. The concept of cluster initiatives.
Cases 6. The California Wine Cluster.
The Australian Wine Cluster: Supplementary Information.
Why has California emerged as one of the leading wine-producing regions in the world and able to
upgrade from producing low-quality wines to premium wines over the last two decades? Why has
France stagnated? How has Australian been able to emerge as a leading wine-exporting nation? What
are the issues facing the California cluster in 2000? What steps are necessary to sustain and enhance
California’s position? By companies? Trade organizations? The Californian government? The federal
government?
7. Clusters in Developing Countries
Second session of the cluster module. Deepen the understanding of the cluster concept by applying it
in the context of transition/developing economies. Use a case from developing country to show the
wide applicability of the concept. Open for a discussion of FDI (linking to Volvo session):
Government incentives and company motivations. Raise student’s interest by providing information
about a less known country and case. Build on the Intel case.
Case 7. Building a Cluster: Electronics and Information Technology in Costa Rica.
What were the limits of Costa Rica's economic development model in the 1980s and the early 1990s?
Why did President Figueres embark on a new approach? What strengths were present to make
electronics and information technology an emerging cluster in Costa Rica? Be specific about the
conditions in a country that indicate that a cluster has potential. Why was Intel interested in a Latin
American plant as part of its global strategy? Why did Intel choose Costa Rica? Given Intel's
decision to locate in Costa Rica, what should the Costa Rican government do next to further the
development of the cluster?
8. Institutions for Collaboration
Third session of the cluster module. Introduce the Intuition for Collaboration as another key concept
to understand the functioning of a cluster . Move the discussion from analysis (“automatic” effects of
business environment quality and co-location) to action (“created” effects of organized activities to
mobilize a cluster). Use a case from developing/transition economy to show that even these relatively
advanced institutional issues have wide applicability.
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Cases 8. Asociacion Colombiana de Plasticos (Acoplasticos). Centre Susse d’Electronique et de
Microtechique (CSEM). Institutions for Collaboration: Overview.
What role has the Asociacion Colombiana de Industrias Plasticas (Acoplasticos) played in the
competitiveness of the Colombian plastics and rubber cluster? How has the role of Acoplasticos
changed since the early 1980s? How could it be more effective? What role has the Centre Suisse
d'Eleclronique et de Microtechnique (CSEM) played in the competitiveness of the affected Swiss
industries? How has CSEM's role evolved? Is it effective? What strategic recommendations would
you make to CSEM leadership in early 2002? Why do institutions for collaboration exist in market
economies? Why can't their activities be performed as effectively by firms or government entities?
Why might the incidence and role effectiveness of institutions for collaboration differ in advanced
economies versus developing economies?
Part III: Policy for Nations and Regions
9. Economic Strategy: Advanced Economies
First session of the “policy at different geographic levels”-module. Apply the concept learned
(diamond, cluster) to a specific country. Introduce the concept of stages in development. And its
implications for strategic shifts in economic policy. Use Singapore to analyze a well known success
story – allows students to refer back to Finland discussion with more tools learned.
Case 9. Singapore Economic Strategy: Independence to 1992.
What was Singapore's competitive position at independence? Why did Lee Kuan Yew decide to abandon
his initial economic development strategy? What was Singapore's economic strategy between
independence and the late 1970s (be specific about the components of the strategy)? Why was it so
successful? Why did Singapore shift its strategy in the late 1970s? Why was Singapore able to sustain its
success? What are the competitiveness issues facing Singapore in 1992? What are the key elements of an
economic strategy for Singapore for the next decade? What significant policy steps are needed, and what is
their rationale.
10. Economic Strategy: Developing Economies
Second session of the "policy at different geographic levels'-module. Apply the concepts learned
(diamond, cluster) to another specific country/ Focus of this session is the specific (and challenging)
context of a much less developed economy in a geography so far not discussed. Open for a
discussion of the role of international aid organizations. Open for a discussion of the links between
competitiveness and traditional concepts for economic development.
Политика на разных географических уровнях: развивающиеся страны. Роль международных
экономических организаций.
Case 10. Rwanda: National Economic Transformation.
Analyze Rwanda's situation at the end of the genocide in 1994/1995. What steps did the initial
Government of National Unity take between 1994 and 2000 to restore the economy? What are the
strengths and weaknesses of this initial approach? Evaluate President Kagame's economic strategy
for the country. What are the issues facing the Rwandan economy in early 2004? What
recommendations would you make to the President and his team? Be specific. What role have
international aid organizations played in Rwanda, both positive and negative?
 50% class participation
- Frequency
- Quality of contributions
- Other contributions
Grading Procedure
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 50% group project
 Consideration of individual factors
 Ranking is translated into grade according to grading system
GRADING SYSTEM
Letter grades are used in performance evaluation as follows:
A-, A, A+
Outstanding (90-100)
B-, B, B+
Good-performing at a graduate level (80-89)
C-, C, C+
Marginal Pass (70-79)
The symbol + or – attached to letter grades increase or decrease the grade respectively by 3.
Academic Policies
The course is taught using case studies drawn from all major regions of the world. Part of the
purpose of the course is to expose students to some of the most successful countries and regions. In
addition to cases, there are readings, a series of lectures, and videotaped appearances by guests who
are national, regional, or business leaders involved in the cases studied.
Each session begins with a case discussion, followed by lectures and guests. The course is also
designed to include a significant team project, which involves assessing the competitiveness of a
country and a cluster within that country under the supervision of a skilled instructor. The technology
of the project consists of some steps:
1. Team formation;
2. Selection of project topic, data collection and initial analysis;
3. Mid-term report, further analysis and recommendation;
4. Presentation draft, presentation to class, feed-back on presentation and report submitted.
Academic integrity is highly valued at Clark. Research, scholarship and teaching are possible
only in an environment characterized by honesty and mutual trust. Academic integrity requires that
your work be your own. Because of the damage that violations of academic integrity do to the
intellectual climate of the University, they must be treated with the utmost seriousness and
appropriate sanctions must be imposed. The maintenance of high standards of academic integrity is
the concern of every member of the University community.
Several ways in which academic integrity may be violated are outlined below.
Cheating has three principal forms:
1.
Unauthorized use of notes, text, or other aids during an examination or in performance
of course assignments.
2.
Copying the work of another.
3.
Handing in the same paper for more than one course unless the faculty members
involved give their explicit permission to do so.
Plagiarism refers to the presentation of someone else’s work as one’s own, without proper
citation of references and sources, whether or not the work has been previously published.
Submitting work obtained from a professional term paper writer or company is plagiarism. Claims of
ignorance about the rules of attribution, or of unintentional error are not a defense against a finding of
plagiarism.
Unauthorized collaboration refers to work that students submit as their own but which was
arrived at through a process of collaboration without the approval of the professor. Since standards
on appropriate or inappropriate collaboration may vary widely among individual faculty, students
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should make certain they understand a professor's expectations before collaborating on any class
work.
Alteration or fabrication of data includes the submission or changing of data obtained by
someone else or not actually obtained in the performance of an experiment or study, except where
allowed by the professor. It also includes the changing of data obtained in the performance of one's
research.
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