Final answer:
Technology and pharmaceutical companies strive for competitive advantages through innovations in human capital and technology, as these can lead to higher profits and maintain a temporary market edge.
Step-by-step explanation:
Technology and pharmaceutical companies pursue competitive advantages based on human capital, technology, and physical plant and equipment. These companies are driven by market competition, which provides a strong incentive for the discovery of new technology. This can lead to higher profits by producing products more cost-effectively or with features that consumers desire. As emphasized by Gregory Lee, former CEO of Samsung, innovation is crucial to maintaining a temporary edge in the market, enabling firms to earn above-normal profits. Moreover, a competitive and market-oriented economic climate encourages the investment in human and physical capital, fostering macroeconomic growth and driving businesses to seek new technologies.