navbar

Singapore : Business & Economics

A guide to Business & Economics in Singapore

Librarian

Books in the library

Visitors to our website

Look at the locations of people who have visited this website!

What is GDP?

DEFINITION of 'Gross Domestic Product - GDP'

GDP is generally defined as the monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis.. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory.

GDP = C + G + I + NX

where:

C is equal to all private consumption, or consumer spending, in a nation's economy.

G is the sum of government spending.

I is the sum of all the country's businesses spending on capital.

NX is the nation's total net exports, calculated as total exports minus total imports. (NX = Exports - Imports)

To summarise, GDP is like a price tag on a country's output, and it measures the size of the economy. 

Overview of the economic/business cycle


(Source: harpercollege.edu)

The term business cycle refers to economy-wide fluctuations in production, trade, and general economic activity. There are four phases that describe the business cycle. At any point in time you are in one of these stages:

  1. Contraction - When the economy starts slowing down. It's usually accompanied by a bear market.
  2. Trough - When the economy hits bottom, usually in a recession.
  3. Expansion - When the economy starts growing again. It's usually signaled by a bull market.
  4. Peak - When the economy is overheated, and is in a state of "irrational exuberance." This is when inflation rears its ugly head.

What is NOT measured in GDP?

GDP is commonly used as an indicator of the economic health of a country, as well as to measure a country's standard of living. Despite being a broad measure, there are several things that GDP does not measure that are essential for both the economy and society. Basically, in order for something to be included in GDP, it has to be something that is actually produced. It has to be something that isn't used to produce something else. It has to be produced here and not somewhere else, and it also has to be legal. 

What's Not Included in the GDP

  • Sales of goods that were produced outside our domestic borders
  • Sales of used goods
  • Illegal sales of goods and services (which we call the black market)
  • Transfer payments made by the government
  • Intermediate goods that are used to produce other final goods 

 

Discussion: Why did you move to Singapore?


(Source: giphy.com)

Singapore is one of the wealthiest per capita metropolises on the planet. Singapore, once swampland, is now a multicultural hub of commerce. More and more multinationals are making Singapore their choice for setting up their regional/global headquarters. Singapore’s strategic geographical location, excellent infrastructure, stringent intellectual property protection, good physical and trade connectivity, and easy access to global talent attract people from all over the world for better opportunities.

On the other hand, Singapore is also the world's most expensive city 2014 and 2015, according to the Economist Intelligence Unit (EIU). Day-to-day life in Singapore is famously governed by a series of strict rules to maintain its clean, well-ordered city. Particularly, the import of chewing gum is banned to avoid the globs on the street. Violating the rules could face serious fine or punishment.  Meanwhile, Singapore is also often criticized by western scholars about its authoritarian democracy.

Why did you move to Singapore? Money or lifestyle? In your opinion, which is more important?