The Nature and Importance of Economic Competence

This chapter takes on three tasks: (1) to survey the study of economic competence as it appears in economic literature; (2) to give a meaningful and operational definition of economic competence as one of the factors contributing to macroeconomic growth; and (3) to suggest a methodology — pursued in greater depth elsewhere — to generalize and link economic competence, as defined at the micro (firm, individual) level, to macroeconomic growth through simulation on the micro-based macroeconomic Model of the Swedish Economic System (MOSES). By introducing knowledge in the micro setting of firm organizational competence, we arrive at a very different interpretation measured at the macro industry level from that of standard neoclassical theory.