4. Determinants of competitiveness

The determinants of competitiveness are the most critical elements of the theoretical framework presented in Illustration 1, they are the factors which affect the performance of a territory in terms of the outcomes (final and intermediate) analysed in the previous sections. Additionally, whereas public policies cannot usually directly impact outcome indicators, it is still possible to reinforce the factors which underpin these outcomes.

The theoretical framework identifies three groups of determinants of competitiveness: those associated with firm performance, those associated with the structure of clusters and groupings of related activities in the economy, and those associated with the business environment in general. Although it would be possible to think of many potentially interesting elements in each one of these groups, the available information is normally limited for the European regions as a whole. The aim of this section is to focus the analysis on certain aspects which are particularly significant and for which there exist available data for regional comparison, accompany them with other analyses specific to the Basque Country without a regional comparison, and present an overview in order to learn how the Basque Country is positioned in comparison with these other regions.

  1. Among the outcome indicators considered, disposable income per capita is in fact directly influenced by the effect of valuation and transfers.