Saturday, August 07, 2004
Does the comparative advantage of your economy impact strategy and competitiveness? Of course it does.
But we've taken ours for granted for a long time - and so it's decayed. The link between macro structure and how it limits (or enables) firm strategy is something that is going to emerge as a very, very serious issue in the next year or so - especially given the latest jobs data.
Here's another great example:
"...the health care liabilities of
both employees and retirees represent
a significant competitive disadvantage
relative to the Japanese carmakers with
their younger, non-unionized work force.
He noted that GM, which has two-anda-
half pensioners for every employee,
estimates that pensions and health care
benefits add $1,000 to the cost of each
car it makes. A structural issue like that
is not easily remedied."