PJC_H2_ECONS_P2_Q5

Pioneer Junior College (Economics Department) 1 PJC 2017 H2 Prelim Exam Paper 2 Question 5: In the US, Japan, UK and much of Europe, there has been no increase in real incomes over the last decade for the median household. This refl ects both the intense global competition and the forces of technology that are challenging a growing range of jobs. Singapore faces the same global realities and challenges . Source: Singapore Budget 2015 a) Explain the impact of global competition and tec hnological advancement on a country’s aim in achieving inclusive growth. [10] b) Assess the use of fiscal policy by the Singapore government to achieve inclusive and sustainable growth. [15] a) Explain the impact of g lobal competition and technological advancement on a country’s aim in achieving inclusive growth. [10] Inclusive Growth Growth that takes into account income distribution Global competition Results in a loss of CA for declining industries DD for workers in these declining industries fall wages fall if these workers do not fall the relevant skills to move to other growing industries rising structural unemployment affects ability of country to achieve inclusive growth Global competition Countries that are less competitive due to higher cost and lower productivity will experience fall in exports and investment economic growth falls less tax revenue for government to redistribute income affects aim of achieving inclusive growth Technological advancement Results in unskilled workers being made redundant if these workers cannot upgrade their skills will not be able to work in the new industries created by the new technology rise in structural unemployment of the less skilled affects ability of country to achieve inclusive growth

Pioneer Junior College (Economics Department) 2 Question: In the US, Japan, UK and much of Europe, there has been no increase in real incomes over the last decade for the median household. This refl ects both the intense global competition and the forces of technology that are challenging a growing range of jobs. Singapore faces the same global realities and challenges . Source: Singapore Budget 2015 (b) Assess the use of fiscal policy by the Singapore government to achieve inclusive and sustainable growth. [15] Fiscal policy can be used to achieve inclusive growth and sustainable growth • Inclusive growth indicates a rate of growth that i s sustained over a period of time, is broad-based across economic sectors, and creates pr oductive employment opportunities for the majority of the country’s pop ulation. In the case of Singapore, inclusive