Economist Bryan Caplan, noted for his insights on public choice, visited
Singapore in November 2008. His observations address how "economically
efficient, but politically unpopular" policies might successfully be carried
through a democratic system, and sheds light on the environment in which
public policy is made and implemented in Singapore.
THE MEDIAN VOTER MODEL
Singapore, when compared to almost
any other democratic country, has two
deeply puzzling features.
Puzzle #1: It frequently adopts policies
that economists would call "economically
efficient, but politically unpopular".1 For
example, Singapore has near-unilateral free trade, admits large numbers of
immigrants, supplies most medical care
on a fee-for-service basis, means-tests
most government assistance, imposes
peak load pricing on roads, and fights
recessions by cutting employers’ taxes.
These are policies that could easily have
cost politicians their jobs in many other
democracies, yet they have stood the test
of time in Singapore.
Puzzle #2: Even though Singapore follows
the forms of British parliamentary
democracy, it is effectively a one-party
state. The People’s Action Party (PAP)
has held uninterrupted power since
the country gained Home Rule in 1959,
has never received less than 60% of the
popular vote,2 and has always enjoyed an
overwhelming majority in Singapore’s
Parliament—it currently holds 82 out of
To put these paradoxes in perspective,
we need to review the Median Voter
Model, the workhorse of studies in
modern political economy. In the
Median Voter Model, two political
parties compete for votes by advocating
a "platform"—a bundle of policies.
Citizens in turn vote for the party
with the platform closest to their ideal
Setting aside various complications,3 the Median Voter Model implies that
competing political parties tend to offer
policy platforms that centrist voters
regard as ideal. This also implies that
a rival party should be able to match
a dominant party’s electoral success
simply by mimicking its centrist
platform. As a result, parties rarely
achieve lasting political dominance.
Despite its abstractions, the Median
Voter Model usually fits the facts of actual
political behaviour in democracies around the world. However, it also
highlights why Singapore’s political
economy is so puzzling. Singapore
persistently adopts policies that would
have been overturned by the democratic
process almost anywhere else on earth,
but the same party keeps winning
election after election by a landslide.
Why doesn’t a rival party promise to
abolish unpopular policies and soar
to power? How, in short, is Singapore’s
political-economic equilibrium possible?
EXPLANATION NO. 1:
SINGAPORE IS NOT REALLY
One common conclusion is that Singapore
must be—despite its Westminsterian
pedigree—a thinly-veiled dictatorship,
which informally suppresses political
rivals and rigs its elections, which in turn
allows the Government to unilaterally
adopt unpopular (yet efficient) policies.
This "Singapore as a thinly-veiled
dictatorship" theory coheres neatly with
Western stereotypes about the city-state,
and elegantly resolves the two paradoxes.
Unfortunately, this dictatorship thesis
ignores three basic facts.
First, Singapore has several legal
opposition parties;4 they may face minor
indignities but hardly live in mortal
fear of the PAP.5 Pressure from the
dominant party is a feeble explanation
for the opposition’s near-total failure to gain political office, given that many
countries (such as Pakistan) demonstrate
vigorous electoral competition despite
far graver dangers.
Second, while there are unusual
restrictions on political expression,
these shield people from criticism,
not policies. Opposition candidates
who avoid personal attacks against
PAP politicians can and do freely
attack specific policies as ineffective
or unfair. An opposition candidate
could safely campaign on a platform to
abolish Electronic Road Pricing or slash
immigration. Indeed, an opposition
candidate could safely campaign on a
platform to rein in politically-motivated
defamation suits. In the Median Voter
Model, embracing these positions would
quickly usher opposition politicians
into power—assuming, of course, that
the median voter genuinely wants the
changes in question.