Average Income in Singapore - PowerPoint

Document Sample
Average Income in Singapore - PowerPoint Powered By Docstoc
					Heeding the Call:
 The Moral Imperative for
    Economic Growth
         No Minimizing Here:
          Global Poverty Is
         Serious and Urgent

• Half the world — nearly three billion
  people — lives on less than two dollars a
  day.
Where Are the World’s Poor?
Is Economic Growth Really ―Good‖
  for the World’s Poorest People?


• After all, we’ve all heard claims to the
  contrary, such as . . .
Is Economic Growth Really ―Good‖
  for the World’s Poorest People?


• The income gap between the incomes of
  rich and poor nations is rising, resulting in
  increasing economic injustice.
Is Economic Growth Really ―Good‖
  for the World’s Poorest People?

• Multinational firms close plants at home,
  and open new ones in Third-World
  countries, because of the incentive to reap
  higher profits by exploiting workers in poor
  nations. These firms pay low wages, and
  do not need to make working conditions
  safe or humane.
Is Economic Growth Really ―Good‖
  for the World’s Poorest People?

• Eventually, the same greedy
  multinationals close up shop and open
  even newer replacement facilities in still
  poorer nations – often due to rising local
  wages and pressure from the workers
  themselves to improve pay and conditions.
Is Economic Growth Really ―Good‖
  for the World’s Poorest People?

• Consumers – like you and me – of these
  products unwittingly contribute to this cycle
  of shark capitalism, paying exceedingly
  low prices for goods like
  – Coffee
  – Sporting goods
  – Electronics
   That sounds bleak, indeed.


• But scratching below the surface, and
  looking more carefully for some longer-
  term trends, reveals some interesting –
  even hopeful – news.
     Economic Growth Trends
•Real GDP Growth in
the World Economy:
The rich countries.
–Japan grew rapidly in the
1960s, slower in the 1980s,
and even slower in the
1990s.
–Growth in Europe Big 4,
Canada, and the United
States has been similar.
    Economic Growth Trends

–The growth of real
GDP per person in a
group of poor
countries.
–The gaps between
real GDP per person
in the United States
and in these
countries have
widened.
     Economic Growth Trends
–Growth in Asian
economies.
–China is growing very
rapidly.
–Other formerly low-
income economies—
Korea, Taiwan, Singapore,
and Hong Kong are
examples—have grown
very rapidly and have
caught up or are catching
up with the United States.
           Reason for Hope
• Average incomes of the poorest fifth of a
  nation’s people, on average, rise or fall at
  the same rate at the average income
  overall (Dollar and Kraay, JEG, 2002).
  – Very strong empirical regularity
  – Holds in a sample of 92 countries
  – And holds within that sample for four decades
           Reason for Hope
• Average incomes of the poorest fifth of a
  nation’s people, on average, rise or fall at
  the same rate at the average income
  overall (Dollar and Kraay, JEG, 2002).
  – Holds across regions and overall national
    income levels
  – Holds in ―normal‖ and ―crisis‖ periods
     Preconditions for Growth
• What features raise incomes overall with
  little impact upon the distribution of
  income?
  – Low inflation and stable monetary exchange
  – Equal treatment of all persons
  – Openness to trade
                                        Low inflation
                            1200
Annual Inflation Rate (%)




                            1000

                            800

                            600

                            400

                            200

                              0
                              1970   1975   1980      1985     1990      1995   2000
                                                       Year

                                            United States     South America
        Equal Treatment of All
• Creative, ingenious people need a climate in
  which they feel safe to live and work.
• They need a reasonable assurance that if they
  work hard to make something happen for
  themselves and their families, it cannot forcibly
  be taken away, whether due to
   – Corrupt governments
   – Organized crime
   – Underdeveloped systems of law, capital, and property
        Equal Treatment of All
• According to the 2007 Index of Economic Freedom,

  Most corrupt nations:      Least corrupt nations:
  Guinea-Bissau              Iceland
  Chad                       New Zealand
  Bangladesh                 Finland
  Burma (Myanmar)            Denmark
       Openness to Trade

Most open:      Least open:
Hong Kong       Libya
Singapore       The Bahamas
Norway          Djibouti
   No unique political system is a
           precondition
• Liberal democracy appears to work
  reasonably well, over many observations.
  – Among other features, it gives a solid base for
    enforceable property rights.


• Authoritarian regimes have, at times,
  created an environment in which growth
  has occurred.
               Conclusion
• What can you and I do?
  – First, get your fingers dirty. Develop a
    discipline of physically the world’s poor.
  – Work to discover what you can do relatively
    easily – and with more joy – to minister to
    world’s hurts and needs.
  – Support generously the NGOs that do what
    you are passionate about, and do it well.
               Conclusion
• What can you and I do?
  – Promote economic freedom and social justice
    through groups like Amnesty.
  – Consider a career in an NGO. Don’t just think
    of those as short-term opportunities.
  – Consider studying more economics. We’re
    hard-headed, but much more thoughtful and
    tender-hearted than you might imagine.

				
DOCUMENT INFO
Description: Average Income in Singapore document sample