Singapore's Education; IP Schools

A small island with no natural resources, Singaporeans are constantly reminded that "humans" are our only resource. Education stands to be a top priority of many Singaporeans families. The (not-so) recent hot topic in Singapore's education system is the integrated programmes (IP), where 12 year olds are selected into an institute that provides them with a safe track to an established Junior Colleges (JCs), and thus, a steadier path towards well-recognized universities.

Mergers and exclusive contracts are major corporate world activities, not just because of the huge underwriting profits for bankers, but also the possible anti-competitive nature of such actions. In essence, anti-competition is bad because consumers lose (e.g. pay higher prices for the same goods) at the expense of the producers. Why a sudden mention of mergers and exclusive contracts? Because the IP structure seems like form of vertical merger/exclusive contract, where upstream and downstream firms form a direct linkage in the production line. Basically, IP-JC sections hold "exclusive rights" to the products (bright students) from the secondary sections. More schools in Singapore are offering IPs, and many parents are worried that their late booming children are disadvantaged by the smaller number of good JC openings for their children later on.

Definitely, my approach of merging (pun intended) these two topics may not be very ideal, but I hope to only  provide a different perspective at the same old boring issue (product differentiation). Maybe someone with more time can look into this issue from this angle, but this guy/girl should not be me (at least not in the near future). Some of the more interesting issues would include:

1) Do child have to score better grades just to enter the same JCs, aka grade inflation.

2) Are IP schools providing better education? Many worry that the IP curriculum weakens the students' ability to tackle exam questions necessary for the 'A' levels.

3) Are primary school kids more pressured now to excel to enter into an IP school, leading to possible burn-outs, post exam trauma, or even other psychological issues, such as poor self-esteem from not being able to enter an IP school. Not sure about the kids, but the parents seem much more pressured to get their kids into IP schools these days.

Lastly, I am glad that I am not a young student anymore. Seeing as an outsider, I cannot help but feel sorry and pressured for these young kids. I cannot expect how it will be like when I have my own kids though, but that, will be another story all together...

Reference point and Singapore's subway system

Reference point is common concept in psychology and behavioural economics. It explains how the mental anchors people hold will influence in their decision-making process. In simple terms, reference points postulates that human decision-makings are not independent of surroundings or situations.

Recently, I believe Singapore has saw an episode that Singapore's subway system, a 24 year well serving system, broke down not 1, not 2, but 3 times. within a week. Singaporeans, as usual, were up in arms. However, I believe that some of the negativity Singaporeans experienced during this fiasco are due to their own high expectations of subway system. Largely in part, this high reference point is some kind of winner's curse, where the strong track record of the subway system has bitten itself, with Singaporeans experiencing their virgin subway disruption of such a great scale. In this aspect, the system should not be faulted for being excellent in for the past 24 years. Other countries, noticeably UK and Paris (as reported in the local newspaper), have subways that have much higher frequencies of disruptions, and fares that are also much higher.

In addition, I guess the negativity also stemmed from other aspects of the transportation system itself. Yes, subway and cab fares rose less than 6 months ago, a topic that I hope to discuss about in a future entry. Yes, this subway disruption was drastic. Some blame the population growth. Yet, I do believe there are areas in which the system can improve itself. For one, how the disruption was handled could have been improved. However, I have no aim of addressing this. My point is this: Singaporeans are setting their expectations too high, which I postulate it to be from the extremely high reference point that Singaporeans are used to adhere and live by. Maybe, we have been living too comfortably.

Kim Jong Il's Death;Korean Won;Market Correction? (Part 2)

Working Day 2 of Kim's death. I was curious to see how else the market would react. Amazingly, the market corrected to post Kim's death rates! At this rate (pun indeed), I am definitely going to follow closely to the Singapore/S.Korean Won exchange rates for some time!

(Just as I ended this entry, I decide to take a look at other rates. A similar pattern was spotted for USD/S.Korean Won. Is the market that over-reactive and volatile? I am so glad I am not a forex trader, because I totally do not know the market!)

Kim Jong Il's Death; Korean Won; Structural Breaks

A picture paints a thousand words, but let me add a few other captions. Kim Jong Il died on Saturday, 17th December, 2011. On Monday, 19th December, 2011, this was the exchange rate between Singapore/S.Korea Won. I assume all other currencies to the Korean Won had the same effects. A structural break I presume, with worries about succession plans and the geo-political stability of the region.

NBA trades and agglomeration economics

The NBA lockdown finally was over, player trades sagas are coming in place, with some having seemingly season defying effects. looking at past seasons, From the Big 3 at Boston (KG, Ray, Pierce) to the Big Flukes in Miami (LeBron, Wayne, Bosh), even Shaq moving to Lakers, and subsequently the Heat, had great influences to the dynamics of the league. Early this pre-season, many are already shocked by Stern's decision to stop Chris Paul's trade to the Lakers. Indeed, restricting free labour movement within the 21st century capitalist state of the world seems just so obscene.

In thinking what motivates a player to move to another franchise, salary naturally makes the list. The "love for the franchise/city" and the franchises' "championship-winning material" definitely comes into play as well. Other influences include "their fit to franchise" and "wanting longer play time" perks. Other issues include the player's age, health, home town, and even utility functions, subjected to certain restrictive assumptions.

Let me take the pages off another Paul, Krugman that is. In his core-periphery model (first published in 1979), Krugman postulates that international trade (and in a somewhat linked fashion, industrial clustering) can occur from a combination of increasing returns to scale and 'love-for'variety' utilities. Here, I evoke a simple concept. One superstar's move to a franchise will up the franchise's "champion-material' ranking, thereby making that franchise more appealing to other like-minded championship hungry superstars. Jordan needed Pippen, Rodman, Harper and Longley. Kobe had Shaq and Gaso, Shaq had Waye, and Boston have a trio. Production towards the NBA championship (a huge winner-takes all production scenario) has a somewhat increasing returns to scale nature too!

Back to the present day NBA. Free market is sustainable because failures fails and winners remain. The Seattle Supersonics "died" (they became very OK-C), Hornets bankrupted (now owned by the NBA, which I think is why Stern had the power to do what he did), while Sacramento almost imploded at the end of last season. The idea of prevent talent clustering to make the league more competitive sounds reasonable, but it also seems to go against the ideas of agglomeration economics. I hope Stern ain't going to throw more intervention shocks this season again. Free market!!!!

Profit and Revenue

Humans have wants, but many fail to remember the costs involved in achieving them. It is worse when people envy the achievement of others without thinking about the pains they had gone through to obtain their achievements. I likened this to the idea of revenue and profits. Constantly, I see people wanting to maximise a certain form of revenue, such as obtaining that degree, the coveted job, that striking girl, without fully considering the costs involved. Totally, everyone is ignoring the idea of profit margins. Yes, we can maximise revenues, but people seem to not realise that this can be done at such a high costs that it will render the 'project' useless! 


In short, I believe to achieve a more peaceful life, people should not overly focus on their wants (revenue), but on the costs involved in achieving them (profits). In Singapore, we constantly strive to be the best in everything. My take is that some times, its not too bad to come in second, aka winner's curse!