This study investigates the role of the state in Singapore???s political economy. The conventional methodology in the neoclassical economics tradition is essentially apolitical and is thus inadequate to appraise the inner working mechanism of the Singapore polity, given the pervasive influence of politics in policy decisions. This study therefore synthesizes a new analytical methodology, drawn from neo-institutionalism, to analyse the interrelations of state, market and social institutions in the Singapore of the People???s Action Party (PAP). Ronald Coase???s theorem of transaction costs, Steven Cheung???s economics of property rights and Douglass North???s theories of institutions and institutional change, collectively, provide a theoretical framework that allows this study to examine the intrinsic nature and characteristics of the Singapore polity. Three major areas are investigated using this research paradigm. The first is the post-war political transition from colony to self-rule and the eventual emergence of an independent Singapore in the context of Cold War politics. The second is the process of social engineering through reconstitution, resettlement and socialization, a process that has aimed to alter the institutional environment that regulates the state and people and has tended to generate a submissive social ethos. The focus of the third is the redefining of property rights through nationalization, industrialisation, and privatisation that, in effect, has resulted in the extensive transfer of private wealth to the state. Four case studies are offered to demonstrate the impact of politics in the making of economic policy, the general effect of which has been to eradicate entrepreneurs in favour of state-owned entities. The analysis concludes that Singapore is essentially to be characterised as a predatory state, and adopts Mancur Olson???s ???stationary bandit??? theory to reconcile the state???s predatory behaviour with Singapore???s record of positive economic development. The study identifies nine unique features that have characterised the Singapore polity, the single most important feature being the emergence of ???Lee???s Law??? which amounts to the paramount Singapore informal rule in regulating all aspect of social exchange. It is paramount because without reference to this rule the inner working mechanism of Singapore???s political economy cannot be explicated. But the predominance of PAP control imposes a heavy social cost as it risks Singapore???s long-term viability as a national state because of the likely emergence of distributional collusion and institutional sclerosis. Singapore???s long-term viability is therefore contingent upon the kind of political reformation that would reinstitute a low transaction cost mediation mechanism that would then facilitate incremental institutional change.
| Identifer | oai:union.ndltd.org:ADTP/240770 |
| Date | January 2005 |
| Creators | Chan, Heng Kong, Humanities & Social Sciences, Australian Defence Force Academy, UNSW |
| Publisher | Awarded by:University of New South Wales - Australian Defence Force Academy. School of Humanities and Social Sciences |
| Source Sets | Australiasian Digital Theses Program |
| Language | English |
| Detected Language | English |
| Rights | Copyright Heng Kong Chan, http://unsworks.unsw.edu.au/copyright |
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