michael porter in his study of national competitive advantage argues that the extent a country is expected to attain global success in a particular industry is a function of the whole influence of factor endowments domestic demand conditions related and supporting industries and domestic rivalry. a government can manage the four components positively or negatively. it can influence internal demand via local product standards or with policies that require or impact consumer needs. the national competitive advantage is the sum of the company competitive advantages in a country. porter described four factors that can affect the global competitiveness of companies located in particular countries. These four elements are factor endowments; demand conditions; related and supporting industries; and the strategy structure and rivalry of the companies located in a country. porter built a model connecting these four sources in a diamond and contended that firms will achieve success in industries which the four sources are favorable. he also insists that the sources in the diamond form a mutually reinforcing system in which the effect of one determinant or source is dependent on the state of the others.


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