Competitiveness and Comparative Advantages: Theoretical Review and Exercise Applied to 30 Cities in Mexico

Abstract

Traditional foreign trade theories fail to explain the evolution of trade derived from globalization, as a result of which new explanations have been put forward, some of which have emphasized the concepts of competition and competitiveness. At the same time, theoretical approaches to local economic growth have gradually adopted the new archetypes of international trade theory. The aim of this article is to discuss the main contributions that have helped to explain the significance of competition and competitiveness at the business, country and city level, as well as the various postulates concerning the determinants of territorial competitiveness or comparative advantages. The review of concepts is complemented by a conceptual and operative proposal for explaining local competitiveness and an exploratory exercise that has been empirically applied to industrial competitiveness in thirty cities in Mexico.