doi.org/10.52340/eab.2024.16.03.06

National competitiveness is a key issue in the research of contemporary economists and enhancing it represents a pressing problem for the economic policy of any country. Its importance has especially increased under conditions of globalization, as more countries and companies are involved in competitive battles. With the deepening of globalization processes, the determinants of national competitiveness are constantly changing. In this process, the role of natural resources, climatic conditions, geographical location, and other static factors (factors inherited by countries that cannot be increased) is diminishing. At the same time, the role of dynamic factors, whose improvement depends on the economic policies and entrepreneurial models of a specific country, is increasing – such as a country’s innovative potential, technological dynamism, human resources, the level of infrastructure development, etc. National competitiveness ensures a country's role in international trade, specifically its ability to export goods and services to world markets, and determines the country’s potential for economic development.
The article analyzes the evolution of the theory of national competitiveness and the ratings of international organizations in this field. We identified the main determinants of competitiveness on the macro level, some of which were investigated using a multiple regression model at the example of Georgia.
In scientific literature, the analysis of nations competitiveness began to develop from the second half of the 20th century. This process has evolved through several stages: matrix approach in the 1960s, factorial approach in the 1990s, and from the beginning of the 21st century until today - empirical approach. The last one evaluates the determinants of competitiveness using empirical methods and selects appropriate indicators.
Porter's four-factor diamond of competitiveness has undergone substantial evolution:
• A nine-factor model: two diamonds, one focusing on national physical factors, the other on international human factors. The analysis of competitiveness is also based on a macroeconomic level, but also includes the involvement of international companies' foring direct investments;
• Generalized Double Diamond Model: Three diamonds incorporated in one. The competitiveness dimensions used on three levels - national, international and global.
• A dual double diamond approach: four diamonds, which is presented by pairs, as national and international physical factors, national and international human factors. In each pair, national diamonds analyze the local business environment, and international diamonds analyze the international business environment.
The discussed models of competitiveness have served as a methodological basis for research conducted by various international organizations and forums. The Global Competitiveness Index provides information on competitiveness and its determinants in the short and medium term, while the Sustainable Competitiveness Index provides a deeper and more comprehensive picture of the countries' position in the global economy. Competitiveness problems at the macroeconomic level are also actively discussed in the World Competitiveness Yearbook of the International Institute for Management Development, which is considered to be the most complete and valid measure of competitiveness methodologically.
The analysis of research conducted by international organizations in the field of competitiveness has shown that the determinants of national competitiveness have significantly extended beyond the factors directly determining a country's comparative advantages in international trade. The center of gravity gradually shifted to indicators determining the efficiency of human capital. Also, the essential determinants of national competitiveness are: government efficiency, infrastructure, developed systems of information, communication, healthcare, education and environmental protection.
Empirical research on the influence of specific determinants of national competitiveness in Georgia has shown that variables such as fixed assets, labor productivity, the share of net inflows of foreign direct investment in GDP, expenditures on education and environmental protection from the consolidated budget, and the country's ranking in the Global Innovation Index explain 90.9% of the change in the share of exports of goods and services in GDP. The analysis of individual variables of the empirical model has shown that the country's ranking in the Global Innovation Index has a statistically significant positive impact on the dependent variable. The identification of such causal relationships allows us to assume that Georgia is in the third phase of the economic development stages theory proposed by Porter, where technologies and innovation are the main determinants of national competitiveness. The main limitation of the conducted empirical research on the determinants of competitiveness is the relatively small number of factors considered. However, the existence of such a limitation creates the prospect for additional research in the future.

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Keywords: Competitiveness; Globalization; Export; Productivity, Investments, Innovations.
JEL Codes: F02, O16, O47, R5