This paper criticizes various indexes of national competitiveness that are widely used these days and discusses the necessity of a new concept that represents the institutional capacity of a government of a country whose natural and historical conditions are different from others, National competitiveness indexes, such as IMD`s and WEF`s, for example, lack rigorous theoretical foundations and contain a lot of validity and reliability problems. Based on the arguments concerning the inherent defects of these concepts, this study proposes a new concept of Government Competitiveness. The new concept, incorporating systems theory, Maslow`s hierarchical needs theory, and Fukuyama`s state function theory as three basic foundational pillars, proposes the core components of a country`s competitiveness by integrating temporal and spatial dimensions. This study calls for further study to elaborate a more detailed model and more systematic indicators that will serve a country`s leaders for making strategic policies toward a more competitive government.