The quest to understand the multilevel antecedents of competitiveness has led to a separation of approaches. On one side of the question are the environment theories that analyze the structural characteristics of the general and competitive environment. On the other side are the Resource Based View and its extensions that highlight firm-specific resources and capabilities as the main basis of firms' competitiveness. However, in recent years the nature of competition and shifting economic conditions have given rise to new theoretical approaches that complement the assumptions underlying both environmental and firm theories. Specifically, this study contributes by examining the regional environment effect, the district effect and the strategic group effect. Through a study of 364 Spanish tourism firms, this research explores the relative importance of distinct external forces such as the general environment or country effect, the regional effect, the competitive environment or industry effect, the district effect, and internal factors such as the firm's tangible resources, capabilities and strategy selection. The results demonstrate that firms' capabilities are more important than environment effects and tangible resources. Display omitted •This study examines the various theoretical approaches available to explain tourism firm competitiveness.•This research explores the relative importance of distinct external forces and internal factors.•The results demonstrate that firms' capabilities are more important than environment effects and tangible resources.•Of the external factors, the most relevant significant variable is the wealth of shared resources in the tourist destination.