Services Competitiveness: Some Conceptual and Methodological Aspects

The increasing trend towards services offshoring during the last decade and its wide-ranging consequences for the international division of labour placed services globalisation and the associated topic of competitiveness into the forefront of debates on international trade. Despite focusing widely the interest of economists and politicians alike, knowledge about the complex issues related to services competitiveness is still scarce. Both theoretical and empirical research on this topic continues to be hampered by the great heterogeneity of services and the lack of adequate statistical data and instruments as well as measurement problems deriving from it. The absence of international consensus on what competitiveness in general and in services in particular really means is adding to these difficulties. While there is large agreement on the economic and social importance of competitiveness, it is less clear what this notion actually denotes, nor is there a common understanding of the main determinants of competitiveness or the most proper instruments for measuring it. Hence, the very notion of competitiveness remains rather vague and subject to different interpretations, and it becomes even more ambiguous when transposed to services. Drawing on current literature that deals with services competitiveness and its determinants, the present paper addresses some conceptual and methodological aspects related to this topic. It highlights the increasing importance of individual countries’ competitiveness in trade in services and tries to distinguish the main characteristics of the concept of competitiveness when applied to trade in services. It also sheds light on the complex nature of the relationship between services and competitiveness due to the peculiarities of services internationalisation and concludes by discussing the main determinants of services competitiveness.