Project Overview

Your fourth economic analysis project asks you to apply your economic analysis skills to analyze economic growth in Singapore.There are two parts to this project. First, you will prepare a memo that analyzes the factors driving historical GDP growth in Singapore.Second, you will assess the potential for future economic growth with other researchers (your peers).

Your report and discussion will be assessed for the quality of your analysis and for the quality of your communication. Please refer to the rubrics for the assignment. You will receive a grade based on the rubric.

You will submit yourmemo by Tuesday, 11/21. Thediscussion will open on Monday, 11/13 and close on Friday, 12/1.

Grades for the memo will be posted by Monday, 12/4.

Late submissions will receive a 10% penalty, with an additional 10% penalty for each additional late day.

Note: There have been some unpleasant experiences with plagiarism in the research projects the last few times this course was taught. You need to make sure you know what plagiarism is and how to avoid it. The University of Arizona has a good resource to help youavoid plagiarismLinks to an external site..

Instructions

You own a 40% share in a private-equity firm headquartered in the United States. The firm invests in assets across the globe and is planning to invest in chemical manufacturing facilities beginning in 2025. The board of directors is meeting on November 21st to discuss the location for the investment and is currently considering investing in Singapore.

As the largest investor in the private-equity firm, the board values your opinion. The board of directors wants you to provide them with an analysis of the factors driving GDP growth in Singapore from the 1960 to 2019. You will use the Solow growth model and your additional knowledge of institutional factors that drive economic growth to prepare your report for your fellow board members.

Youreconomic analysis memois due on Tuesday, November 21st.The memo to the board of directors must address the following:

1. An empirical analysis of the underlying contributors to economic growth in Singapore over the past six decades. You will use the growth accounting and Solow residual model to examine Singapore's historical growth. Provide a table that presents the results from your empirical analysis, decomposing economic growth in each decade to growth from capital, labor, and factor productivity. You can find the instructions and the data below: - Instructions for the empirical analysis: Canvas page - Data (excel): FRED Data for Singapore.xlsDownload FRED Data for Singapore.xls
2. An analysis of economic growth in Singapore over the period from 1960-2019. Included in this analysis should be a discussion of any significant changes or patterns observed in long-run economic growth over the period, and the main factor(s) from the Solow Residual Model that drove these changes.
3. A more detailed discussion of economic growth inoneof the decades. This discussion should examine the major contributing factors to growth in your empirical analysis in more detail (e.g., why, or how did capital stock/labor/total factor productivity change). You should also explore any changes in institutions or the economic environment that might have contributed to growth, but not be accounted for in the Solow model (e.g., property rights, openness to trade).
4. Finally, recommend to the board of directors whether to invest in Singapore or not, and why. Base your recommendation on the potential for Singapore to grow as a country and how economic growth can help the success of an investment in this country.

Your memo should present only your final results (table) and not your calculations. Your calculations must be submitted separately with a copy of the spreadsheet containing your work. Find below an example of a table to present your final results in the memo:

	%Y Economic Growth	%K. Capital Contribution	(1)%L. Labor Contribution	%A. Total Factor Productivity Contribution
1960s
1970s
1980s
1990s
2000s
2010s

If you have never written memos before this class, please refer to theResources for Economics Researchpage on Canvas, available under theResearch Projects Module.