Theory of Michael Porter
This theory introduces the concept of competitiveness. That national competitiveness, in terms of Porter, determines the success or failure in specific industries and the place which the country takes in the world economy. National competitiveness is determined by the ability of industry. In explaining the basis of competitive advantage of the country is the country's role in promoting home renovation and improvement (ie, in stimulating the production of innovations). Government measures to maintain competitiveness:
1.The impact of government on the factor conditions;
2.The impact of government on the conditions of demand;
3.The impact of government on related and supporting industries;
4.The impact of the Government's strategy, structure and rivalry between firms.