FACTOR INTENSITY OF SINGAPORE'S EXPORTS AND IMPORTS

Abstract

What sets this study apart from the others of similar nature is the methodology. It is the first full-scale study in Singapore using the input-output technique developed by Professor Wassily W. Leontief. In addition to its coverage of the entire economy, and the use of direct and indirect factor requirements, it is the first time that skill intensity coefficients are computed directly from the Leontief's methodology. Furthermore, unlike the Leontief-type test that has been performed in many other countries outside the United States, the test used in this study has a very significant modification - it allows for foreign productive structure and factor supplies. This has also inspired a re-examination of the famous Leoutief's paradox with important implications. A discussion of some important theoretical concepts and a review of selected literature are presented in this study. The methodological and computational procedures are also provided, together with an in-depth discussion on the statistical data - their sources and problems involved. The number of pages in there belies the painstaking effort and enormous time put into the collection and computation of the data. Apart from the verification of the Heckscher-Ohlin theorem's prediction, and establishing of Singapore's trade pattern, some interesting correlated results are portrayed. For instance, it was found that though both the manufacturing and service sectors' exports are less capital- and skill-intensive relative to imports, the latter's imports have a higher capital but lower skill content than the former's. An alternative test of the Heckscher-Ohlin theorem - the Fels test - is also performed to confirm that of Leontief's. In addition, an intertemporal test is conducted for the confirmation of the trend, that Singapore is less labour­ intensive in 1983 than the earlier years, as detected from the results of the Leontief's test.