Competition is fostered by the increasing size of the market opened up by these technologies. Products with a high knowledge component generate higher returns and a greater growth potential. Competition and innovation go hand in hand. Products and processes can be swiftly imitated and competitive advantage can be swiftly eroded. Knowledge spreads more quickly, but to compete a firm must be able to innovate more quickly than its competitors.
Brands are critical.
They strengthen consumers' trust in nations and their products In a global marketplace where consumers are overwhelmed by choice, brand recognition assures their trust in both the tangibles and intangibles that a product will deliver. Like intellectual capital, brand equity can be hard to measure yet it may account for a significant proportion of a company's value. It is intangible in the sense that it often consists of customers' perceptions of the value they gain from using a product or service rather than any measurable benefit. Brand New Zealand has often been used to attract visitors. Any small government that ignores these facts will be punished through capital flight and currency devaluation.