Economics Tuition – Is Singapore’s standard of living really high?
Many economists and statistical reports from prominent research institutions have ranked Singapore as one of the countries with a higher standard of living as our real Gross Domestic Product has been ranked in the top ten of all nations over the years. However, skeptics are quick to point out that our standard of living may be overrated if we consider the qualitative aspect of living and limitations of the economic indicators of real GDP per capita as a measurement of standard of living. However, the quality of life in Singapore has improved if we conduct a deeper and wider scope of examination.
As depicted by the Straits Times, our real GDP capita has risen from $1,580 to $71,318 from 1965 to 2014. Critics are quick to point out that standard of living has not improved given that there is high degree of unequal distribution of income and price level and population growth rate had risen tremendously and this may have eroded the real purchasing power on an average basis. To a certain extent, the arguments may be right if we purely assess this from a quantitative basis, given that Gini coefficient is around 0.475 for Singapore and can be an alarming issue as the size of population is small. Prices have been quite high as some may see how non-core inflation has made many feel that the ownership of crucial assets like houses is an impossible dream.
However, if we examine from a wider angle and more holistic way, we do fair better than our parents and grandparents. First, prices may rise for some luxury and high-valued goods but most of the daily necessities affordable as our wage rate has risen for the majority of workers. More families are dining out and the places that they are dining in more posh and sophisticated restaurants, implying that life has become luxurious.
Second, the social policy of public housing and subsidized education to help the general public has been a great success. For education, our literacy rate is 96.7% as stated by Economics Development Board in 2104 survey (refer to table above) and there are extensive upgrading programmes to help the less-educated individuals to raise their skill level and qualification, thus improving their degree of employability and wage rate. As for public housing, the Housing Development Board (HDB) is proud to claim that public housing is ’Home to over 80% of Singapore’s resident population, and with population is able to afford public housing as such that nearly 90 percent’ and these public houses are also built at an acceptable level of quality admired by many foreigners. Furthermore, the precincts are well supported by amenities like public parks and swimming to create a more relaxed and comfortable environment which will raise the quality of life for Singaporeans.
In general, the country is also well-facilitated with extensive public amenities and well-connected with public transport to make it easy for commuters travel from one part of the country to another part. Telecommunication connectivity is also high where there are 4,608,800 mobile subscribers and the mobile penetration rate is 148%, indicating that Singaporeans do enjoy a high level of standard of living as they enjoy a high level of convenience and comfort.
Last but not least, the country is a safe place to raise a family and enjoy life, given the low crime rate. People do feel safe to stay up late as the street is free from robbery and petty crime with only one unexpected riot in Little India. This indicates a politically safe environment for investment which will promote prosperity, enabling the economy to attain sustainable economic growth to promote higher level of standard of living.
Do we have a high standard of living? Yes, we have but there is always the concern to make sure that this high level of standard of living is enjoyed by all people in Singapore. The task to make Singapore an inclusive society for all is not an easy task but it must be the aspiration that all Singaporeans will want to achieve so that we can make sure that there is high standard of living for all Singaporeans.
This article is contributed by Mr. Simon Ng, founder and principal JC Economics Tutor of Economicsfocus, who has 20 years of teaching experience. Currently, Mr. Simon Ng provides specialized Economics Tuition and GP Tuition. To read more articles on Economics issues and skills development, please refer to the JC Economics Essays blog.