Measuring Global Competitiveness

27/08/2015
Global Competitiveness :
II- Measuring & Comparing
Michel Henry Bouchet

www.developingfinance.org
MH BOUCHET/SKEMA COPYRIGHTS
MEASURING
COMPETITIVENESS?
1.
2.
3.
4.
5.
6.
Trade/GDP and market share in global exports

FDI attractiveness
Relative costs (taxes, unit labour cost, real
exchange rates)
Productivity
Technology, innovation and R&D
Ratings & rankings (WEF, IMD)
27/08/2015
1. COMPARING TRADE OPENNESS RATIOS

200
Trade/GDP Ratio %
180
160
140
120
100
80
60
40
20
OECD
2. COMPETITIVENESS AND GLOBAL TRADE MARKET SHARE

United States
10,5
China
10,5
7,0
Germany
4,6
Japan
15 countries account for >61%

of global trade
3,4
France
Netherlands
3,4
United Kingdom
3,1
Italy
2,7
Belgium
2,4
Korea, Republic of
2,9
Hong Kong, China
2,8
15 countries account for >

61% of global trade
2,5
Canada
2,1
Singapore
1,7
Spain
2,0
Mexico
33,3
Other Members
0
WTO 2014
10
20
30
40
27/08/2015
FRANCE: MARKET SHARE IN GLOBAL EXPORTS 1948-2014

(Devaluations = 1948, 1958, 1969, 1976, 1981, 1982, 1983)
7%
3,6%
7%
3,4%
Trade deficit =
-$95 billion
THE IS NOT TO BLAME!

Market share of Frances exports in the Eurozones total goods exports
12,6
27/08/2015
RATIO OF FRENCH EXPORTS PRICE DEFLATOR TO THAT OF GERMANYS EXPORTS
1995-2014
Ratio of French merchandises exports/

Germany exports 1995-2014
COMPETITIVENESS IN THE
ZONE?
A true measure of comparative competitiveness in the same
currency zone, i.e. in the Euro-zone, should take into account
not only unit labor costs (total labor costs including social
charges), but also the value added content of industrial
exports.
Germanys exports are much less price-elastic than exports
from Spain, France, Italy and Portugal. Hence, high labor
costs in France add to the lower competitiveness of Frances
exports, due to the lower VA content of the industrial outputs.
27/08/2015
3. FDI INFLOWS as a measure of competitiveness (US$ million)

350000
100000
USA
France
90000
300000
80000
250000
70000
60000
200000
50000
150000
40000
30000
100000
20000
50000
10000
1998
2000
2002
2004
2006
2008
2010
2000
2002
2004
2006
2008
2010
2012
1996
1994
1998
1992
1990
1996
35000
1988
1986
1984
1982
1980
1978
1976
1974
1972
0
1970
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
Mexico
30000
25000
20000
15000
10000
5000
UNCTAD 2014
2012
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
4. PRODUCTIVITY AS KEY DRIVER OF

GLOBAL COMPETITITVENESS
What is Productivity ?
Ratio of a volume of output to a volume of input use
Labour Productivity = Ratio OUTPUT/LABOUR
Combination of technological progress, R&D, NTIC,

capital investment, labour volume and quality, labour cost,
labour intensity, work hours, social cohesion, strikes.
27/08/2015
THE KEY ROLE OF PRODUCTIVITY IN SUSTAINING

LONG-TERM ECONOMIC HEALTH
The most important factor determining continued

advances in living standards is productivity growth,
defined as the rate of increase in how much a
worker can produce in an hour of work. Over time,
sustained increases in productivity are necessary to
support rising household incomes.
Fed Chair Janet Yellen, 11 July 2015
AVERAGE WORKING HOURS/YEAR 1960-2015

Korea= 2100
France 1850s = 3045 hours/year

Source: OCDE/2015 & Conf Board
27/08/2015
AVERAGE OECD YEARLY NET WORKING HOURS

(AVERAGE ALL FULL AND PART-TIME EMPLOYEES)
1536 hours
Rexecode/Eurostat 06 2014
PRODUCTIVITY GAPS IN THE OECD = GDP/WORKING HOUR

IN % OF USA
Productivity gaps =
GDP/working hour in % of USA
Source: OECD
27/08/2015
PRODUCTIVITY VERSUS SALARY RISE IN FRANCE % 1970-2014
Source: OCDE-Eurostat
US PRODUCTIVITY GROWTH HAS AVERAGED A 2.2% ANNUAL RATE OVER THE

PAST 5 DECADES. HOWEVER, SINCE 2010 PRODUCTIVITY HAS AVERAGED ONLY
1.1% PER YEAR AND IS CURRENTLY ESSENTIALLY FLAT
27/08/2015
LABOUR COST COMPETITIVENESS?

RELATIVE HOURLY MANUFACTURING LABOUR COSTS
Bangladesh:
Vietnam:
Tunisia:
China:
Mexico :
Romania:
Poland:
Spain:
UK:
UE:
Germany:
France:
Source: Eurostat & OECD for 2014
$0,25
$1,2
$2
$2,5
$2,5
$5,1 (4,6)
$9,5 (8,5)
$23,3 (21)
$ 24,7 (22,3)
$27,7 (25)
$35 (31,5)
$39 (35)
AVERAGE MONTHLY LABOUR

COST
(/month)
BAD, MTPE 2015, OECD
27/08/2015
AVERAGE MONTHLY SALARY IN ASIA IN

Hanoi/
Saigon
Guangzhou/
Shanghai
Singapour
Bangkok
Jakarta
Manilla
Kuala
Lumpour
Delhi
Worker
160/180
350-400
470
150
150
230
340
120
Engineer
300/400
800-1200
1500
600
350
350
670
600
Salary gap Asia/Europe
Worker
Engineer
Hanoi/
Saigon
Guangzhou/
Shanghai
Singapour
Bangkok
Jakarta
Manilla
Kuala
Lumpour
Delhi
1 to 7
1 to 3
1 to 2,5
1 to 8
1 to 8
1 to 6
1 to 4
1 to 10
1 to 8
1 to 4
1 to 2
1 to 5
1 to 8
1 to 8
1 to 4
1 to 5
HOW COMPARING RELATIVE

LABOR COSTS ACROSS COUNTRIES?
Total wages cannot allow to compare the actual cost of employees.
Wages do not take into account labor compensation (social charges,
taxes). And high wages do not mean the same thing in high and low
productivity sectors or countries regarding business profitability!
Unit Labor Cost measures Competitiveness = Average total labor
compensation per worker and per unit of output, including productivity
Ratio
Labor compensation per worker or per hour

Output per worker or per hour
10
27/08/2015
GERMANY HAS CUT SALARY COSTS, WITH LOW DOMESTIC DEMAND

AND DYNAMIC EXPORT REVENUES
Germany
1999=100
WHO IS AND
WHO IS NOT
COMPETITIVE
?
11
27/08/2015
COMPETITIVENESS INDEX
DAVOS-WORLD ECONOMIC FORUM
France= 23
China = 29
South Afr = 53
Brazil= 56
India = 60
Russia = 64
IMDS TOP 10 OF GLOBAL COMPETITIVENESS 2014

USA
2. Switzerland
3. HongKong
4. Sweden
5. Germany
6. Canada
7. UAE
8. Denmark
9. Norway
10. Luxemburg
1.
16. UK
21. Japan
23. China
26. Korea
27. France
38. Russia
41. Mexico
44. India
52. South Africa
54. Brazil
12
27/08/2015
CONCLUSION
HOW TO BOOST COMPETITIVENESS?
1.
2.
3.
Increasing productivity (good management,

education & training, infrastructure and
institutions, labor mobility, investing in R&D and
innovation)
Reducing costs (inputs, wages, exchange rates,
providing subsidies and tax incentives)
Improving efficiency and product quality as well as
marketing (Germany vs France?)
13

Measuring Global Competitiveness

Transféré par

Informations du document

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

Measuring Global Competitiveness

Transféré par

Droits d'auteur :

Formats disponibles

27/08/2015

Michel Henry Bouchet

Trade/GDP and market share in global exports

1. COMPARING TRADE OPENNESS RATIOS

2. COMPETITIVENESS AND GLOBAL TRADE MARKET SHARE

15 countries account for >61%

Hong Kong, China

15 countries account for >

FRANCE: MARKET SHARE IN GLOBAL EXPORTS 1948-2014

THE IS NOT TO BLAME!

RATIO OF FRENCH EXPORTS PRICE DEFLATOR TO THAT OF GERMANYS EXPORTS

Ratio of French merchandises exports/

3. FDI INFLOWS as a measure of competitiveness (US$ million)

4. PRODUCTIVITY AS KEY DRIVER OF

Combination of technological progress, R&D, NTIC,

THE KEY ROLE OF PRODUCTIVITY IN SUSTAINING

The most important factor determining continued

Fed Chair Janet Yellen, 11 July 2015

AVERAGE WORKING HOURS/YEAR 1960-2015

France 1850s = 3045 hours/year

AVERAGE OECD YEARLY NET WORKING HOURS

PRODUCTIVITY GAPS IN THE OECD = GDP/WORKING HOUR

PRODUCTIVITY VERSUS SALARY RISE IN FRANCE % 1970-2014

US PRODUCTIVITY GROWTH HAS AVERAGED A 2.2% ANNUAL RATE OVER THE

LABOUR COST COMPETITIVENESS?

Source: Eurostat & OECD for 2014

AVERAGE MONTHLY LABOUR

BAD, MTPE 2015, OECD

AVERAGE MONTHLY SALARY IN ASIA IN

Salary gap Asia/Europe

HOW COMPARING RELATIVE

Labor compensation per worker or per hour

GERMANY HAS CUT SALARY COSTS, WITH LOW DOMESTIC DEMAND

IMDS TOP 10 OF GLOBAL COMPETITIVENESS 2014

Increasing productivity (good management,

Vous aimerez peut-être aussi