Bryan Caplan  

Singapore's Policy Secret: Economic Literacy, Deference, or Resignation?

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Notes on McArdle's Law... When You're in a Hole, Keep Di...
Here's a question that got a big laugh around a Singaporean lunch table: "So, do most people here support Electronic Road Pricing?"  Not on your life!  If you want to see how S'poreans really feel about ERP, check out this hilarious Youtube video.  Like people all around the world, they want to drive free of charge.  And like people all over the world, they ignore the connection between unpriced roads and congestion.  Never mind that over the border on the unmetered streets of Kuala Lumpur, people can easily sit in traffic for an hour.

This ERP question inspired a deeper discussion - and one of the highlights of my trip.  I spoke before an audience of about fifteen young S'porean civil servants.  During the Q&A, my host, Donald Low, turned the tables on the audience.  He quoted this post:

My biggest (and potentially most sensitive) question: Do Singaporeans actually support their uniquely efficient policies? An earlier study found that Hong Kongers are statist at heart; are Singaporeans any different? My suspicion is that the source of Singapore's success is not the public's unusually high economic literacy, but its unusual deference to economically literate elites. Will experience confirm my suspicions?
Donald then asked each attendant to answer my question.  To be more precise, he asked them to choose between three explanations:

a. Unusually high economic literacy.

b. Deference to elites - the belief that S'porean elites know what they're doing and deserve support.

c. Resignation - the belief that regular S'poreans can't affect policy, so there's no use trying.

When I was planning my trip to S'pore, several people told me that S'poreans wouldn't want to discuss this issue.  They were dead wrong.  Every attendant answered the question - and none of the answers were sugarcoated.  Most attendants said "A mix of deference and resignation," with slightly more emphasis on deference.  Only one or two people said that the public's economic literacy mattered - and even they put it last in importance.

Admittedly, this informal survey suffers from potentially severe selection bias.  Perhaps civil servants exaggerate the incompetence of the public to make themselves feel important.  But I suspect that if selection bias plays a role, it goes in the opposite direction: Civil servants are more likely to exaggerate the popularity of their policies to make themselves feel well-liked.  The fact that "resignation" remains a popular answer is telling: The architects of policies like ERP might like to fantasize that the public loves their work, but daily experience gets in the way.


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COMMENTS (10 to date)
David R. Henderson writes:

Hey, Bryan. Welcome back. I've missed your insights on the world.

Selfreferencing writes:

I missed you too bry, bry.

Alex J. writes:

It's one thing to defer to elites. It's another thing for those elites to be economically literate and to put that ability to use for the public good. Why are Singapore's elites as economically literate and as public spirited as they are? Perhaps historical accident: Lee was (relatively) economically literate and public spirited. He was successful, hence influential.

johnleemk writes:

The question posed is exactly the sort of thing Singaporeans would likely lap up. Why would they want to dodge it? Their whole society is built on ideal of elitist meritocracy - only the best win. Egalitarianism is not much of a popular ideal in Singapore. The ordinary man defers to his betters, and is resigned to the fact that he can't accomplish much in the face of their superiority.

This probably sounds dystopian to the Westerner, but it's really not. Asian society is fundamentally built on this kind of thinking, and it works pretty well as long as equality of opportunity is respected. I suspect a primary reason for the runaway success of Hong Kong and Singapore is that their governments implemented successful policies meant to preserve economic equality of opportunity, which combined with a culture of respect for the elite who obtain their positions on merit, led to great economic prosperity.

A more interesting question is probably how to reconcile all this with democracy. I personally don't see a way for authoritarianism to continue unimpeded in Southeast Asia - at some point or another even the most successful government has to screw up spectacularly.

Steve Roth writes:

Yes Bryan welcome back.

So on the ERP, seems like we're looking at a utility function that ranks freedom higher than free time.

Yes, it's the monetary cost of ERP that serves to restrict their freedom, but from your description it seems like the psychological imposition on their freedom is what really bothers them, more than the monetary vehicle whereby they're imposed upon.

Interesting.

EML writes:

"And like people all over the world, they ignore the connection between unpriced roads and congestion."

ERP don't exactly deal with congestion. The supply of 'certificates of entitlement' to own a motor vehicle does.

ERP merely forces any consequential congestion (according to the number of certificates of entitlements issued) into another time slot.

aiyoyo writes:

hello Bryan,

aiyoyo very funny youtube video :)

& real informations about mrt,

many foreigners talked to, cant believe this thing is happening!!

(ERP)

aiyoyo sad...

Blackadder writes:

Congestion pricing will only work if the disutility that comes from paying is greater than the disutility that comes from sitting in traffic, at least for a considerable number of people. But in that case the system "works" by making people worse off. Are the net benefits to those who continue to use roads at peak hours despite pricing enough to overcome the costs to those who are deterred from doing so? How would you tell?

Miguel writes:

Between the big public finance picture, and the vast array of externalities that auto travel inevitably involves, it's more complicated than Blackadder suggests.

ERP revenues help pay (directly or indirectly; I don't recall which) for improved public transportation, so those who don't choose to drive during congested periods receive an additional benefit.

Likewise, those of us who would never drive in any case also benefit from reduced pollution due to fewer idling vehicles.

Those who need urgent medical care benefit from streets that ambulances can traverse more quickly. Here in Kuala Lumpur ambulances are not taken very seriously because it takes them so long to arrive. I have been involved multiple times in using private cars to bring to hospital people whom in other cities I would never dream of trying to move without medical experts on hand.

P.S. "S'pore" looks really toolish in print, especially coming from someone who doesn't live there.

Elia Diodati writes:

The sense of disenfranchisement runs strong in Singaporeans, especially among the young and mobile.

Also, I would advise you to factor in the typical Asian reticence in not revealing everything one thinks to someone new and unfamiliar. Consider what has been left unsaid to you.

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