• “We need to think deeply about what economic development is and who it is for; and, engage the larger society in that conversation.”

    Dr. David T. Barnard
    President and Vice-Chancellor
    University of Manitoba

  • “Rising income inequality undercuts the trust that is essential for the market system to work.”

    Art DeFehr
    President and CEO, Palliser Furniture.

  • “Investing in people in the new economy is now not just morally sound, but economically rational”

    Alan Freeman
    Cultural Economist

  • “Organizations and societies in which the top few appropriate most of the value are like inverted pyramids – inherently unstable”

    Dr. Hari Bapuji
    Associate Professor, University of Manitoba

  • “The present crisis has overturned many accepted truths: that poverty matters but inequality doesn't is one of the more important.”

    Radhika Desai
    Professor, Department of Political Studies, University of Manitoba

  • “The income gap between rich and poor, between skilled and unskilled workers, has been rising in both developed and less developed countries for a number of years. The trend is disturbing and we must find a way to turn this trend around.”

    Michael Benarroch
    Dean, I.H. Asper School of Business, University of Manitoba

Friday, March 29, 2013

When it comes to economic inequality, can America learn from Singapore?

By BEIF Team

Although BEIF’s focus is on the relationship between economic inequality and business, it is imperative to note that governments can do a lot to reduce inequality and its negative effects on society. In a recent article, famed economist Joseph Stiglitz highlights the response of the Singaporean government to economic inequality.

Stiglitz notes that the Singapore government has (i) encouraged individuals to take responsibility for their future through a mandatory comprehensive savings plan for their individual healthcare, housing, and retirement needs. (ii) introduced progressive social welfare programs funded by the government and the rich, (iii) redistributed pre-tax income, and (iv) has made heavy investments in education and scientific research.

Critics may argue that Singapore is a centralized state, which makes it easy for it to take such measures. But Nordic countries such as Sweden, Denmark, Finland, and Norway, which are democratic too, have managed to decrease the levels of inequality in their societies.

Indeed, much can be done by states and specific policy prescriptions differ based on the type of government or socio political situation of the country. But, there are several ways in which governments can respond and we need more conversations on the effect inequality has on societies and how governments and other stakeholders (such as business) can address it.