From Efficiency-Driven to Innovation-Driven Economic Growth: Perspectives from Singapore

45 Pages Posted: 30 Apr 2005

See all articles by Kim-Song Tan

Kim-Song Tan

Singapore Management University

Sock Yong Phang

Singapore Management University - School of Economics

Date Written: April 2005

Abstract

This paper looks at Singapore's efforts to transform the economic growth base from one that is predominantly efficiency driven to one that is more innovation driven. To accelerate the transition process, the government is aggressively investing in "innovation infrastructure" systems and institutions that make the city a more conducive environment for innovations. The modus operandi, with a distinctive "winner-picking" flavor, mirrors that of its earlier strategic industrial policy in building up the manufacturing sector. It is also in sync with the new urban growth literature, which argues that the success of any innovation-driven growth strategy depends on a city's ability to attract a large community of creative individuals in different fields. Innovation infrastructure building requires more than putting in the right systems. It also requires a mindset change at various levels of society. This paper looks at how the government's policy philosophy and practices have evolved over time, and discusses the effectiveness of the government-led, strategic supply-push approach in propelling Singapore onto an innovation-driven growth path. It takes into consideration the city-state's underlying comparative advantages (or disadvantages) and asks how Singapore's existing strength in efficiency infrastructure may give it a first mover advantage in attracting creative talents, how its success may be affected by the small size of the economy, and the various political and social constraints that a small sovereign city-state faces. These issues are explored against the backdrop of the keen competition among the major cities in the region to become an innovation hub.

Suggested Citation

Tan, Kim-Song and Phang, Sock Yong, From Efficiency-Driven to Innovation-Driven Economic Growth: Perspectives from Singapore (April 2005). Available at SSRN: https://ssrn.com/abstract=712623

Kim-Song Tan (Contact Author)

Singapore Management University ( email )

50 Stamford Rd.
Singapore 912409, 178899
Singapore

Sock Yong Phang

Singapore Management University - School of Economics ( email )

90 Stamford Road
178903
Singapore

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