THE ROLE OF FDI IN QUALITY-BASED COMPETITIVENESS: THE CASE OF CZECH REPUBLIC

The paper evaluates the qualitative aspects of the Czech Republic position in the global economic flows in terms of their knowledge intensity. The stress is being put on structural characteristics of value-added, FDI and R&D and the innovation activities indicating the change of competitive advantage towards the increasing role of internal innovation capacity and unique product and processes. This change, however, may not be fast enough to compensate for weakening cost-based competitiveness. Despite the increasing share of FDI companies in domestic R&D activities, their average knowledge intensity remains low. The prevailing competitive strategy relies on adoption of foreign technology knowledge to local needs, possibly with minor adjustments.