The assessment of competitiveness in the case of Latvia and Lithuania

Abstract

Purpose – the purpose of the article is to reveal and to assess the factors of the industry’s competitiveness. Research methodology – to achieve the aim of the article the total factor productivity, return on equity and comparative analysis methods are used. Findings – the most productive sectors in Lithuania are mining and quarrying; electricity, gas, steam and air conditioning supply; water supply, sewerage, waste management and remediation activities; manufacturing. It follows, that companies at mentioned sectors are working productively and purposefully use its equity. In Latvia, the most productive industry is financial and insurance activities, where earns in comparison with the total shareholder’s equity invested in it are greater. Research limitations – in this article the following research limitations are applied: here are analyzed the data of the 2007–2017 y. y. using total factor productivity and return on equity methods. Also here should be included the space limitation (here are analyzed the Latvia and Lithuania cases). Practical implications – the improvement of the industry’s competitiveness is possible due to the targeted management of the main productivity factors: labour and capital. Originality/Value – productivity is based on the maintenance of the industry’s productivity due to the proper use of the production factors to create value-added. Also, are analyzed the relation between total factor productivity and return on equity.