Traditional economic theory predicts that factor cost advantages, coupled with an open economy, are crucial to the development of an efficient export sector. Porter's recent work has offered a more coherent hypothesis. This study of nontraditional exporters from Central America finds support for Porter's work. External environmental factors per se do not translate into competitive advantage; they do so only insofar as they translate into managerial competencies and appropriate marketing strategies. Policy guidelines are developed from these findings.
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