Abstract
Creating competitive industries has become one of the key tasks of governments. Different adaptation outcomes in industries across nations cannot be accounted for fully simply by an emphasis on firm-level capabilities, market-driven policies, or state-level policies. We propose an integrative framework that draws on both the strategic management and political economy literature to explain variations in national industrial competitiveness. We discuss differences with respect to institutional characteristics and capabilities, competitive outcomes, conditions of best fit, and who bears the cost of industry adaptation.
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