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Porters Competitive Adv

In: Business and Management

Submitted By trevo1
Words 8605
Pages 35
Strategic Management Journal, Vol. 12, 535-548 (1991)

ROBERT M. GRANT Management Department, California Polytechnic State University, San Luis Obispo, California, U.S.A.

Porter's Competitive Advantage of Nations is an important book which bridges the gap between strategic management and international economics while contributing substantially to both. Porter's analysis ofthe impact of national environment on international competitive performance demonstrates the potential for the theory of competitive strategy to rescue international economics from its slide into refined irrelevance, while simultaneously broadening the scope ofthe theory of competitive strategy to encompass both the international dimension and the dynamic context of competition. Nevertheless, the breadth and relevance of Porter's analysis have been achieved at the expense of precision and determinancy. Concepts are often ill defined, theoretical relationships poorly specified, and empirical data chosen selectively and interpreted subjectively.

The Competitive Advantage of Nations is an important book. Among Porter's books to date, it is the broadest in scope and the most ambitious in intent. The book addresses a question which lies at the heart of economic and managerial science: 'Why do some social groups, economic institutions, and nations advance and prosper?' (Porter, 1990: xi).This is no new issue: the same question stimulated Adam Smith's Wealth of Nations in 1776 and has been a central theme motivating the development of economic science since then. The purpose of this article is to assess the extent to which Porter provides a satisfactory answer to this question, and, in doing so, the contribution which the book makes to international economics and to strategic management. Before getting to grips with these substantive...

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