Indeed, a key reason for Singapore's economic success was that its pattern of economic development corresponded - even more than most Asian economies - to that of a developed economy, with its overwhelming dominance by capital accumulation and labor inputs and the small role played by TFP growth. This can be seen clearly from comparing the data for Singapore with that for advanced economies shown in Figure 3.

In advanced economies as a whole, 57 percent of growth is due to capital investment, while in Singapore that figure is 59 percent. In advanced economies, 32 percent of growth was due to labor inputs, whereas 34 percent of growth in Singapore was due to labor inputs. Furthermore, 11 percent of growth in advanced economies was due to TFP increases, and in Singapore it was only 8 percent.

In short, Singapore's pattern of growth was essentially the same as that of an advanced economy, which is largely the reason why Singapore has achieved the per capita GDP of an extremely advanced developed economy.

Figure 3

To put it in blunt but accurate terms, Lee Kuan Yew showed through Singapore's economic development that quantity was far more important than quality in achieving a higher level of per capita GDP than the U.S.

This is indeed a crucial lesson for China and for every developing country to study as they seek to replicate Singapore's success and approach the level of advanced economies.

References

Young, A. (1995, August). The Tyranny of Numbers: Confronting the statistical reality of the East Asian growth experience. Quarterly Journal of Economics, 110, 641-680.

Krugman, P. (1994). The Myth of Asia's Miracle. Foreign Affairs, 62-78.

Vu, K. M. (2013). The Dynamics of Economic Growth: Policy insights from comparative analyses in Asia. Cheltenham, U.K. and Northampton, M.A., U.S.: Edward Elgar.

The writer is a columnist with China.org.cn. For more information please visit: http://www.ccgp-fushun.com/opinion/johnross.htm

Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.