Wednesday 24 July 2024

Why do some countries get rich?


The video above points out that while globally, the world has gotten rich in the last 2 centuries, the wealth is not equally distributed. And that 6.7 billion people still live on $30 or less. Why?

At 3:16, the video provides an answer: Freedom. The freer the country, the richer the people are able to be.

At 6:35, Singapore is highlighted.

BUT...

There are detractors in the comments, questioning if Singapore is truly "Free".

And if you reference "Freedom" as defined by Freedom House, Singapore is categorised as "Partly Free", with a score of 48. 

Which would suggest that the theory is wrong. A less than free country has high per Capita GDP? 

Except that, you should take "Freedom House" ranking with a grain of salt, and discount their huge dose of ideological bias. 

Freedom house ranked Malaysia (53), Indonesia (57), Philippines (58), and Timor Leste (72) higher than Singapore. Are these countries truly freer than Singapore?

I cannot say, cos I am not familiar with their social and political system.

But certainly, if they are freer than Singapore, they should have higher per capita GDP than Singapore, according to the hypothesis of the video.

They don't. 

The video uses the freedom ranking from the Atlantic Council. Here are the comparison with 4 other countries

So if you use Freedom House ranking, Malaysia, Indonesia, Philippines and even Timor-Leste score and rank higher than Singapore. But none of them are richer (in per Capita GDP) than Singapore.

Which suggests that Freedom House is scoring and ranking a form of freedom that does not correlate to prosperity, and is thus less useful for analysis, here.

The Atlantic Council's scoring and ranking of "Freedom" correlates better to prosperity of the various countries and so, empirically, their "Freedom" is more relevant and useful.

Also, Singapore is ranked highly for "Economic Freedom", "Ease of doing business", and "Best Place to do Business" elsewhere. Forbes also rank Singapore, the Safest City for travellers. Singapore does not pursue ideological ranking that does not serve our (economic) purpose. But we also pursue other achievements, such as least corrupt country or at least a country with low corruption, high human development index, high standard of healthcare, low infant mortality rate, high rankings of our students in the Programme for International Student Assessment (PISA). 

But yeah. We don't play silly "democracy" games.












 

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