88年 - 88 國立交通大學_碩士班入學考試試題_運輸工程與管理學系：科技論文#123646

1. **Competitive Strategy: The Core Concepts**

Competition is at the core of the success or failure of firms. Competition determines the appropriateness of a firm's activities that can contribute to its performance, such as innovations, a cohesive culture, or good implementation. Competitive strategy is the search for a favorable competitive position in an industry, the fundamental arena in which competition occurs. Competitive strategy aims to establish a profitable and sustainable position against the forces that determines the industry competition.

Two central questions underline the choice of competitive strategy. The first is the attractiveness of industries for long-term profitability and the factors that determine it.Not all industries offer equal opportunities for sustained profitability, and the inherent profitability of its industry is one essential ingredient in determining the profitability of a firm. The second central question in competitive strategy is the determinants of relative competitive position within an industry. In most industries, some firms are much more profitable than others, regardless of what the average profitability of the industry may be.... Both questions are dynamic, industry attractiveness and competitive position change. Industries become more or less attractive over time, and competitive position reflects an unending battle among competitors. Even long periods of stability can be abruptly ended by competitive moves.

[Adopted from *Competitive Advantage* by Michael Porter.]

2. Efficiency and Technical Progress

The famous economist Joseph Schumpeter is usually credited with the view that some monopoly must be tolerated to obtain progressiveness. According to Schumpeter:

But in capitalist reality as distinguished from its textbook picture, it is not [perfect] competition which counts, but the competition from the new commodity, the new technology, the new source of supply, the new type of organization...---competition which strikes not at the margins of the profits and the outputs of the existing firms but at their foundations and their very lives.

Before turning to a rivalry model that provides some insight into these issues, it maybe helpful to explain several terms that will be used in our discussions. At the beginning there is basic research, which seeks knowledge for its own sake. Most industrial firms engage in applied research, which is directed toward a particular product or process. If successful, invention takes place, which is the discovery of new knowledge. After invention, development must take place, leading to the commercial application of the invention, or innovation. The last phase of technical change is the diffusion of the product or process throughout the industry, or economy.

[Adopted from _Economics of Regulation and Antitrust_ by W. Kip Viscusi,
John M. Vernon and Joseph E. Harrington, Jr. .]