Theoretical aspects of competitiveness of products of agricultural enterprises

Abstract

Introduction. The main question that underlines research in economics is how to allocate resources in order to ensure social welfare, including full employment and high living standards. Researchers are interested in which sector can contribute the most to a nation’s economic growth and they often turn to the concept of competitiveness as a basis for analysis. In particular, the competitiveness of the agricultural sector, which in general has been protected in developed countries, is central, especially given the potential consequences if protection is reduced. The article is dedicated to the actual problem – the competitiveness of products of agricultural enterprises, which are the subject of research of many modern scientists.

Goal. The purpose of research is the generalization of the approaches of defining the essence of the concept “competitiveness of products of agricultural enterprises”.

Research methods. In the research process the following scientific methods have been used: historical (for the study scientists’ views of competitiveness), abstract and logical (for the theoretical generalizations and formulation of conclusions), analysis (for the research of the definitions of "competitiveness" and "competitiveness of products"). This article, based on a literature review, investigates the competitiveness.

Results. Several  authors  stress  that  competitiveness  does  not  have  a  definition  in  economic theory. Competitiveness can be defined as the ability to face    competition and to be successful when facing competition. Competitiveness would then be the ability to sell products that meet demand requirements(price,  quality,  quantity)  and,  at  the  same  time,  ensure  profits  over  time  that  enable  the firm to thrive.  Competition  may  be  within  domestic  markets  (in  which  case  firms,  or sectors, in the same country are compared with each other) or international (in this case, comparisons   are   made   between   countries).   Competitiveness is therefore a   relative measure.  It  is,  however,  a  broad  concept  and there  is  no  agreement  on  how to define  it, nor  how  to  measure  it  precisely.  There  is  a  profusion  of  definitions  with  studies  often adopting  their  own  definition  and  choosing  a  specific  measurement  method. The Organization for Economic Co - operation and Development (OECD) defines competitiveness as the “ability of companies, industries, regions, nations, and supranational regions to generate, while being and remaining exposed to international competition, relatively high factor income and factor employment levels on a sustainable basis”. The European Commission uses the following definition: “a sustained rise in the standards of living of a nation or region and as low a level of involuntary unemployment as possible”.  In the article the approaches of defining the essence of the concept “competitiveness of products” were considered. The plurality of these approaches was influenced with their complexity and multidirectional of understanding of this issue among scientists. Specified definition of the concept of competitiveness of products was formulated. Each interpretation of competitiveness of products complements each other and determines competitiveness of products as a complex of price, quality, technical, environmental and aesthetic parameters of a product, which at a certain time meet the requirements of the market and satisfy the requirements of potential customers, providing commercial success for the producer.

Further research of the problem may concern the evaluation and increasing competiveness of products of agricultural enterprises, the theoretical basis of which will be specified essence of investigated concept.

Keywords: competition, competitiveness, competitive advantages, competitiveness of products, agricultural enterprises