Per Capita Income of Singapore

Per capita income means how much each individual receives, in monetary terms, of the yearly income generated in the country. This is what each citizen is to receive if the yearly national income is divided equally among everyone. Per capita income is usually reported in units of currency per year.

 

As per the publications by the Department of Statistics (DOS), the Gini coefficients calculated from per capita household income for both the entire population and households with income earners have been increasing. Secondly higher income households have been experiencing much higher rate of growth in real income than the average population while lower income households have seen a more moderate rate of growth.

 

The increase in Gini coefficient has increased in the aftermath of the 1997 Asian Financial Crisis and economic slowdown earlier in the decade.

 

Since income distribution responds to both changes in the production structure of the economy and changes in the composition of the workforce, understanding trends in income inequality would require us to trace Singapore's pattern of economic development and the particular set of policies adopted by the country.

 

In the early stages, the Government leveraged on the advantage of the efforts by multinational companies to relocate their industrial activities to lower cost countries. A industrialization strategy focusing on labor intensive manufacturing was launched. This growth was favorable to improving Singapore's income distribution, as a result while the demand for labor increased, the demand for low skilled labor increased faster. As a result, those at the bottom of the income distribution gained disproportionally. But this growth did not sustain for too long and it broke down in the subsequent stages of economic development.