Economics Assignment: Output Performance, Labor Market, and Price Level in Singapore

Running Head: ECONOMICS ASSIGNMENT
Economics Assignment
Name of the Student
Name of the University
Course ID

1ECONOMICS ASSIGNMENT
Introduction
Singapore despite constrained by its geographic size and limited resource availability has
attained a sustained path of economic growth. Operation under free market economy and
openness to global economy help the economy to become one of the fastest growing nation in
Asia. Global financial crisis though hit the economy in 2008 but it soon recovered due to internal
strength of the economy and effective policy design (Chiu, 2018).
The economy is characterized as one of the most open and corrupt free nation. The low
tax rate of 14.2 percent makes the nation a favorable destination for business investment.
Government in Singapore support high value added economic activities in its manufacturing and
service sectors. Some major sectors of the economy include Banking, Biotechnology, Energy
and Infrastructure and Real Estate (Barkat et al., 2016). Export is one main source of revenue in
Singapore. The competitive position of Singapore in production of electronics, chemicals and
different services is largely supportive to export expansion.
Output performance of Singapore
Real GDP, Real GDP growth rate and Real GDP per capita
In order to measure output performance of the economy real GDP, growth in real GDP
and per capita real GDP are used. Real GDP is an inflation corrected measure of aggregate
output where goods and services are valued at base year prices. Growth in real GDP is the
change in real GDP presented as a percentage of previous year GDP. Per capital real GDP is a
measure of per capita income and obtains by dividing GDP with total population (Baumol &
Blinder, 2016).
Performance trend in Singapore

2ECONOMICS ASSIGNMENT
Real GDP
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
150
170
190
210
230
250
270
290
310
Real GDP
Year
Real GDP
Figure 1: Real GDP in Singapore
(data.worldbank.org, 2018)
Real GDP in Singapore has increased significantly in the past ten years. Factors causing
an increase in real GDP include expansion of export, investment and rapid growth of
manufacturing and service sector in Singapore. This is only in the year 2008 when real GDP
decreased because of global financial crisis. However, recession had not sustained for a long
period and GDP again started to increase since 2010.
GDP growth rate

3ECONOMICS ASSIGNMENT
2004 2006 2008 2010 2012 2014 2016
-2
0
2
4
6
8
10
12
14
16
18
7.5
8.9 9.1
1.8
-0.6
15.2
6.2
3.9 5
3.6
Real GDP Growth Rate
Real GDP Growth Rate
Year
Real GDP growth rate
Figure 2: Trend in real GDP growth in Singapore
(data.worldbank.org, 2018)
Economic growth in Singapore experienced some fluctuation due to fluctuation in internal and
external economic activities. The economic growth rate is lowest in 2009. The recorded growth
rate was -0.6 percent in this year (Benetrix, Lane & Shambaugh, 2015). The highest growth rate
is recorded in 2010 with growth rate being 15.2 percent. A significant portion of economic
growth is accounted by the manufacturing sector. The economic grew at a moderate rate of 3.6
percent in 2014.
Per capita real GDP