Benjamin Mak and Thng Yi Ren - Economic Society of Singapore

Introduction
‘The most superficial student of Roman history must be struck by the extraordinary degree in which
the fortunes of the republic were affected by the presence of foreigners, under different names, on
her soil.’
Henry James Summer Maine
As Singapore recovers from the 2008 financial meltdown, we are again confronted with the
challenge of immigration, a demographic trend that has buttressed our economic growth but raised
fresh questions about our national identity. With sustained effort to develop Singaporean enterprises
and talent however, this essay confutes the canard that immigration and socio-economic well-being
are mutually exclusive over the long run.
Perceived challenges from immigration
Singaporeans often view immigrants as threats to their well-being. This was made starkly clear in
the angry petition from residents of Serangoon Gardens in 2008 against the construction of a new
foreign workers‟ dormitory near their homes 1 .
Although there is strong empirical evidence that immigrants add value to Singapore‟s economy,
immigration is often associated with concentrated benefits and diffuse costs 2 . While businesses and
the government reap rewards from immigration through cheaper labour and higher taxes, the burden
of accepting immigrants here is placed upon society, making it difficult for ordinary Singaporeans
to see how they benefit personally from immigration.
Following the watershed 2011 elections, the government has emphasised the need to review policies
across the board. While this is broadly accurate, there remain two myths surrounding immigration
that must be dispelled to clarify the true significance of immigration for Singapore‟s economy.
1 See Forss (2008)
2 Olson (1965)
3