AN EXPLORATORY STUDY ON INCOME SORTING IN SINGAPORE

Abstract

Qualitative research suggests that income inequality is a reproduction from income sorting. It seems that Singapore is faced with widening income gap, a fate of that advanced economies cannot avoid. Yet, little or no research has been done to explore the trend of income sorting in Singapore. This study adopted a sequential methodology to explore the demographic distribution of the Singapore population. The first objective is to ascertain whether income sorting is indeed a current trend through analysing the household income variances within and across the neighbourhood. The second aim is to investigate the possible factors, their magnitudes and directions on income sorting in Singapore. R2 shows how much the total variance is explained by the variance across the neighbourhood. It is found that income sorting is present in Singapore when the R2 for 1990, 2000 and 2010 are 53.1%, 73.4% and 74.6% respectively. The extent of income sorting also increased through the 20-year period in which the ratio of household income variance within the neighbourhood to the variance of between neighbourhoods fell from 23.9 to 12.3. The scatterplots also suggest that neighbourhoods with higher incomes are more homogenous. The successive regression model found that the mean log income and good level of accessibility of the neighbourhood exert a negative effect on the household income variance within the neighbourhood. Contrary to past literatures, Singapore population does not exhibit a sorting towards good schooling quality. This study is, however, challenged by the data constraints. Attempts were made to reconcile the differences for comparisons. This study recommends that the role of income sorting must be explored as it contributes towards the reproduction of inequality. This study also suggests that the demographic distribution to be examined on other ii dimensions, such as housing quality and retail facilities, which may play bigger roles in a juridically homogeneous Singapore.