It has become popular recently to talk about things normally unassociated with aid as part of a larger aid/ development framework. Financial Times ran an article on remittances (for greater detail, see IMF’s World Economic Outlook 2005) as the new aid, and outlined its significance as its volume dwarfed traditional aid flows. Thus, I would like to suggest intellectual property violations, more commonly known as piracy, as a form of aid flow, and consider the possibility of how this can be incorporated into a larger development framework.

The difference between such piracy and other forms of infringements, such as ripping off Gucci or Prada bags, is that IP has long term contributions to the infrastructure over and above the personal utility from the product. Piracy allows developing countries to rapidly develop its IT infrastructure to first-world standards, and contributes vastly to its economic well-being. Economist KS Jomo, IDEAS founder, argued that developing countries should not implement tough IP copyright laws, as this has asymmetrical benefits towards rich countries.

Reframing piracy in this way can help policy-makers rethink their policy. Perhaps they can even subsidize software makers and consider this flow as part of transfer payments to the third world. However, before any action can be taken, an agreeable methodology to discern the actual amount of IP flows is necessary. A discount rate has to be applied to the cost of software forgone, as it can be argued that at the prices for original, uptake will be far less than it currently is.

A friend recently called me for advice due to some trouble in his army unit that could result in arbitrary arrest and imprisonment. I understood his worry, although I felt it was needless. Something I learned in my previous life – a past that belongs to the time I was living in the country of Singapore – as a conscript is that risk and worry must be framed in an appropriate perspective. There are a lot of things which have exogenous causes and which we can do little to change. If we can’t change it, why worry? After all, what comes will just come. I have learnt to become very detached from the issues that afflict me. This allows me to keep things in perspective as I am able to avoid over-focusing on the worst case scenario or on bad news, as most people are apt to do.

Military laws in that country are often ambiguous and outcomes to any incidents conform to a bell-curve distribution. There are worst case scenarios to any incident such as imprisonment. There are also best case scenarios such as a simple slap on the wrist. Most outcomes will fall in between these two extremes. Understanding the probabilities involved and knowing that in some cases, there is little we can do to shape outcomes, should tell us that worry is unnecessary.

Furthermore, knowing the worst case outcomes, and being ready to accept it, enhances the ability to deal with worry. Perhaps something I did could result in a few months imprisonment. Yes that sucks, but at least I know what will happen and I am prepared for that outcome. And if things turn out for the better, I am relieved. So worry is all about framing, and knowing what you can and cannot do to affect outcomes.

Things are starting to get heated up at work as I am now helping the firm with the creation of our own REER index. REER is complied by comparing exchange rate against a basket of trading partners, assigning weights according to the trade volume between countries and factoring in inflation.

REER has two embedded factors that are being compared: inflation and exchange rates. It can be used to compare competitiveness of a country (falling REER implies that that country is becoming more competitive). However, it must be noted that this usefulness is contingent on the exchange rate regime in place as a intentionally deflated currency is suppressed not by competitiveness but through artificial measures.

The problem with compiling such models is that our ideal methods are often constrained by data availability. For example, we might not receive exchange rates for all currency in a timely manner and this limits our ability to construct the trade ratio with all countries. Thus, we might have to take selected countries only, taking care not to omit major trading partners. These partners should comprise a significant portion of total trade of the country. I noticed that oil prices is changing the significance of certain trading partners, and thus require adjustment of the list of selected countries.

We also need to question what price index is most useful for our purpose. Is [domestic] consumer price index (CPI) a good measure of the competitiveness of goods exported? If there is a better index, is it as readily updated as the CPI?

I have decided to take the Huntsman program in International Studies in Business at the University of Pennsylvania (Wharton School) in Philadelphia. I was impressed by the program’s director’s readiness to answer my question and connect me with students and faculty who share my interests. In addition, the readiness of their alumni to answer my questions, and their answers, convinced me that I will be happy at Huntsman. Being in Huntsman will allow me to bypass the bureaucracy, considering the resources devoted to the program.

A friend at Wharton strongly discouraged me, citing insidious peer pressure from the Singaporean clique at Penn to ignore the liberal arts requirement of my education. I am not dismissing the risks outlined by him, and will have to take precautions to manage them. Although the Wharton education is not exactly development economics, Tim and Al pointed out that the Wharton side will allow me to narrow my study in development economics to specific issues, while the Penn side will allow me to explore the broader and more thereotical aspects of development economics.

I am also selected for the Benjamin Franklin Scholars and Joseph Wharton Scholars programs. These will allow me to pursue my research interest in development issues and emerging markets for the next four years and tap into additional resources at the college.

In the end, I decided to turn down the substantial scholarship offers (not your government ‘come back and be bonded’ kind but the REAL scholarship with no bonds) from the other liberal arts colleges and universities. So to Singaporeans out there, yes, you can fund your college education without resorting to government scholarships. In particular, Carleton college, a great liberal arts school, has a scholarship specifically for Singaporeans, which generous funds close to half of your school and living fees. Before you sign on that dotted line, consider whether the costs to your liberty is worth it, whether you really know what you are in for and if you will enjoy your future career as a bureaucrat, even after being exposed to the opportunities out there. You could be doing poverty relief in Africa, research in MIT or consulting in New York, don’t throw away your choices so soon. Weigh them! Some of you will like your career in the civil service, some won’t (from my experience talking to many of them), so keep your options open! As for me, I will definitely have to work during all summers and in the school term to fund my education, but in the end, the freedom and education I receive will make it all worth it.

I wrote this essay for the NGO I am working for

Abstract

This essay calls for greater flexibility in the ‘O’ levels examination. It identifies a de facto policy limiting the effective ‘O’ Level results to the best scores attained from two consecutive sittings of the examinations. It also identifies a de jure policy that requires students who take the examination to be above 15 years old, thus preventing the average Secondary 3 student from sitting for any subject papers even if they are ready. The paper then calls for a lassiez faire approach that would allow students to take the examination in either June or December sittings of the ‘O’ Level examinations at any time, allow individual agencies to determine how best to read multiple sittings of the examination, or to at least allow students to use their best combined grades from all subjects to apply to government educational programs. It justifies this on the grounds of (1) how the requirement for two consecutive sittings is arbitrary, and (2) how any official policy on the reading of examination results is highly distortionary to free market conditions. It must be noted that problem (2) is compounded by the arbitrary guideline of (1). Furthermore, the paper argues that such policies limit curricular diversity in Singapore’s education system, with a causal effect on the lack of diversity in the Singaporean economic model.

If relationships were a market (there is supply and demand), all relationships were heterosexual and monogamous, and if everyone wants to be in a relationship, would markets clear (i.e. achieve equilibrium where everyone has a partner)?

This question has been bothering me for sometime, as I seek answers to why I am still single. Of course the most obvious answer is that if instead of writing about my situation I had used the time to expand my social circle, I might conceivably be more successful in the market for relationships. But let’s not get too commonsensical! Instead, I am pondering the existence of a general description of such a market and if it clears.

Supply and demand of males and females would be relatively inelastic in such a market, as there is a significant time lag between birth and eligibility for a relationship/ marriage. Furthermore, the incentives of producers (parents) are borne out through the biological urge to propagate one’s genes. Such a complicated mechanism lies out of my expertise, and I cannot ascertain logically how such incentives will affect the supply of males or females in this market.

There is of course no price in this market and I suggest that we replace ‘price’ with ‘expectations’ (i.e. expectations of what boyfriend should be like. This is assumed to be on a linear scale). In a market with a high supply of males, expectations of a suitable boyfriend from the female perspective increases, as they have a greater pool to choose from. Thus, increase in supply leads to increase in expectations. Demand (which can take the form of the supply of females) is thus inversely related to expectations.

One way of looking at this market is s by assuming two goods that are substitutes for each other. Females can choose to remain single, or to enter a relationship. At the lower end, males are so odious that the opportunity cost of entering a relationship (i.e. the choice of remaining single) outweighs the emotional benefits of the relationship. Perhaps the boyfriend is abusive and as such, this market does not clear.

However, what we consider low-quality males (or females) is highly subjective and tends to change over time. I suspect that a serious problem with the model, and a possible cause for disequilibrium, is that expectations are a function of time. Not only is it a function of time, but it is very highly dependent on this function. To illustrate this point, imagine an average Korean girl brought up watching Korean dramas. Her expectations of a suitable boyfriend, perhaps in high school, would involve him looking like Korean movie star (ala Rain), being incredibly submissive and caring (ala the male lead in My Sassy Girl) and being able to sing like Rain (since Karaoke is such an important element of Korean social life). Of course average girl, being average (note that average is not a function of looks only, but can be generalized to include character, personality…etc.), will be unable to attract such a boyfriend (assumed to be top quartile of males). Over time, she lowers her expectations to match reality: until she finds average boy to be a suitable boyfriend. Given enough time, most of the market should clear as expectations adjust to supply and demand. However, this process could take years because the market is rigid due to expectations slow adjustment to match reality.

Another cause for possible disequilibrium is information asymmetry in the market. Although looks are an important signal, it can be assumed to be only one part of the assessment criteria for a potential boyfriend or girlfriend. However, looks remain the most easily discernable criteria. To uncover the personality and interests of multiple individuals, to find a suitable partner, requires a heavy investment of resources (whether time, money or mental reserves). It is often through undergoing a long relationship that we come to understand the idiosyncrasies of our partner. As the human lifespan is limited, we cannot investigate every potential partner to such depth. In addition, it is in the self-interest of each person to disguise personal flaws to attract opposite members of higher quality. This has negative externalities as it lowers the credibility of all market participants. As the cost of finding information in the market is unusually high, we can consider this market to be inefficient. Thus, most people remain in relationships even if they ‘suspect’ the relationship to be sub-optimal. Over time, they rationalize the relationship (apologies for being so unromantic and harsh about it here).

Further complicating this situation is that the existence of several sub-markets. People can be looking for short-term relationships (flings), medium-term relationships (testing the waters) and long-term relationships (marriage). Males and females could have different demand for each relationship type. For example, males are often stereotyped as having greater demand for flings compared to long-term relationships, vis-à-vis females. This demand is also time dependent if we accept the anecdotal evidence that people, as they get older, find themselves more anxious for marriage, as they might get ‘left on the shelf’.

There is obviously much inefficiency in the market for relationship. However, is it possible to create certain assumptions that allow the market to clear such as in the Arrow-Debreu model of general equilibrium [1]? Is it possible and if so, what would these assumptions be?
Anyone can suggest some good research papers on this issue?

[1] A-D model suggests that, should the assumptions made about the conditions under which it works hold (ie. Convexity, Perfect Competition and Demand Independence), then there will be a set of prices such that aggregate supplies will equal aggregate demands for every commodity in the economy, and that there will be price for every commodity and such a market for every time period and forward prices for every commodity at all time periods. (www.wikipedia.org)

I attended a talk by Jack Nagel, Associate Dean of the University of Pennsylvania SAS on the application of economic reasoning in political science. This is mainly accomplished through Rational Choice Theory (Sen distingushes between ‘three levels’ of RCT). Under this encompassing field is Social Choice Theory (created by Kenneth Arrow) and Collective Action problems.

Unfortunately, I did not manage to stay to listen to his full lecture, and only managed to listen to his coverage of the basics, most of which I have read in Sen’s rationality and freedom. However, some of the arguments against this application of economics can be summarized as

1. Post ad-hoc reasoning rather than being predictive (complex instrumentality)
2. Method-driven rather than problem-driven (law of Hammer: give a kid a hammer and everything becomes a nail)
3. (can’t remember the rest)

However, he pointed out that one advantage of this field, and Kenneth’s arrow impossibility theorem is that it corrects a major flaw of political science. He said that while polsci has been useful in explaining why things exist as what they are, it cannot tell us how current situations can be improved. Thus, Kenneth’s axioms in his impossibility theorem demonstrates what we CANNOT hope to achieve, and thus what else we can actually achieve.

The National University of Singapore (NUS) recently hiked its tuition fees by 8%. However, students were not informed of the hike, with most students obtaining the news from the press rather than from the administration itself.

Although questions of whether the hike itself was justified remain valid, the main bone of contention should be about transparency, accountability and stakeholdership. Hairen outlines the transparency and accountability issues at stake. I will dwell a little more on the stakeholdership issues.

Stakeholdership:

The lack of consultation with students over the hike, before a decision was made, clearly indicates their importance to the administration. Not all stakeholders are created equal and in this case, the students were clearly on the bottom of the list. The Ministry of Education obviously remains at the top of the pecking order, followed by faculty and administration, and with students, the student union and the alumni being bit players in distribution of power on campus.

In getting students to pay higher school fees, the administration will have to recognize that students are becoming a more mainstream source of revenue (vis-a-vis the Ministry of Education). Changes in the relationship has to be made commensurate with this change in funding capacity. If NUS wants to move closer to a private university model/ alumni-funded model, it has to recognize that disenfranchising and alienating its students is a sure path to failure.

Bangkok Post News

” Pol Maj-Gen Jamnong said Thailand had no policy on welcoming North Koreans to use the country as a transit point to South Korea, and the government was deploying every means to block them from entering the kingdom. However, he said, it was not completely successful.”

This article disturbs me. I wonder what is the rationale for this violation of human rights?

” They deemed the situation a threat to national security that needed immediate attention.”
Thailand has the right to security. However, the North Koreans aren’t exactly terrorists out to terrorize poor Thai villagers. The same article reports:

‘’These North Koreans entered Thailand and later surrendered to local police because they believed that it was the only way to enable the Seoul government and the UNHCR [United Nations High Commissioner for Refugees] to accept them as political refugees and send them to South Korea,’’ said Jamnong Kaewsiri, the Chiang Rai police chief.

Do democracies and countries with substantial freedoms have to be consistent in dealing with issues that have implications beyond their borders? Should they seek to grant freedom to people other than their citizens?

This is a crucial issue lying behind the asylum system. Although consistency is difficult if not self-contradictory (See Sen ‘Rationality and Freedom’), I see the process aspects of freedom as having externalities that bear implications on Thai citizens. Violation of the human rights of these foreigners implies complicity in a crime which would not be tolerated if committed against the Thai people. Such violation tarnishes the credibility of Thai instituitions’ commitment towards human rights of its own people.

I am currently writing a paper for an NGO I have been working with since 2003. We founded a non-profit school for high school dropouts last year and my current work involves looking at how the O Level system can be reformed (the O Levels is Singapore’s secondary school graduating exams). In particular, the O Levels examination now allows the best grades from two consecutive sittings to be combined to obtain the ‘official’ examination result of the student. I believe that this system is unforgiving, unfair and rigid in certain aspects and can be improved on by allowing students to combine the best scores from all their sittings.

I believe that the O Levels primary purpose is to test for academic ability and aptitude in a subject. By forcing students to cram examinations of all subjects taken into a short period of three to four weeks introduces variables that detract from this purpose. In such a system, exam skills, time management and the ability to work under pressure and handle exam stress are introduced as ‘noise’. I believe that even if these are skills are valuable and should be tested for, the O Levels should not be the appropriate forum for its testing as it is first and foremost an indicator of academic ability.

Furthermore, this system is unforgiving. Students who might be sick during an examination period, or who are suffering from relationship or family problems then are penalized. Ultimately, the highest grade in the exam, regardless of the sitting in which it is obtained, should be a fair indicator of demonstrated academic potential.

The current system is also inflexible and arbitrary. We can emulate the American SAT 1 and 2 examinations to achieve greater flexibility. The SAT 1 and 2 examinations used by top US universities for admissions, in theory, allow students to combine the best scores from any sitting. However, some universities do take into account the number, but not the order, of sittings (i.e. They will hold it against you if you took SAT 2 Math IIC twenty times as you have an advantage over poorer students who can only take it once or twice). We can move towards this model as it also allows market flexibility (as Pinquan, my Columbia libertarian friend points out). In this system, universities and employers determine for themselves the best method for reading the O Level transcript (i.e. Will they consider only best grades from consecutive sittings or form any sittings). The government should refrain from an arbitrary official position on how it should be read, and leave it to employers to determine for themselves which reading best suits their purpose. This also supports our current approach of giving greater flexibility to schools and universities.