Title: An International Macroeconomic analysis and critical review of the Singaporean economy 2020 – current challenges and future directions. Is Singapore well positioned to recover in 2021

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Title: An International Macroeconomic analysis and critical review of the Singaporean economy 2020 – current challenges and future directions. Is Singapore well positioned to recover in 2021

Title: An International Macroeconomic analysis and critical review of the Singaporean economy 2020 – current challenges and future directions. Is Singapore well positioned to recover in 2021

 Word Count: 3000-4000 (with diagrams), Max 4,500

 

Apply knowledge developed from each course topic  in your scenario analysis – for example the final piece of work may follow a structure such as: –

  • Introduction
  • Assessment of 2020 changes in the Balance of payments and net foreign wealth
  • The intertemporal model of the current account- the CA balance: likely changes and implications for future consumption
  • Exchange rate determination in the short run and the long run – What can theory tell us about current and likely future changes in the value of SGD – assessment of  policy mechanisms and adjustments possibly required to maintain the exchange rate within a given band
  • Elasticities and absorption approach to the current account – how might changes to the exchange rate flow through to the domestic economy. What about Y-A = X-M?
  • The RER and internal and external balance- automatic mechanisms of adjustment- Where is Singapore currently on the SWAN diagram – possible policy interventions?  (noting you can make assumptions about relative elasticities of the IB / EB schedules)
  • Macroeconomic policy options put in place over the year – likely outcomes / limitations-using the IS-LM-BP to illustrate
  • Choice of exchange rate regime – has Singapore’s exchange rate mechanism help or hindered recovery
  • How well is Singapore positioned to recover in 2021
  • Conclusion / discussion

 

 

Rubrics:

  • Analyse Singapore’s balance of payments to examine the economic importance of changes in a nation’s net foreign wealth position in light of COVID 19
  • Evaluate theories of exchange rate determination – how do they interact with the Singaporean exchange rate mechanism. What are likely changes in interest rates and inflation rates and how might these impact on the supply and demand of SGD – what would be the appropriate actions of the MAS in response
  • Assess the policy options available in an open macroeconomic environment in 2020. Frameworks to assess the policy options include -The absorption model, the SWAN diagram, the IS LM BP model
  • Evaluate the extent to which macroeconomic policy effectiveness is affected by macroeconomic openness. How might Singapore recover from external shocks – do the usual recovery mechanisms apply given the global pandemic
  • Assess the implications of a government’s choice between a fixed and a floating exchange rate regime. Is Singapore better position for recovery given its exchange rate mechanism? Analyse the causes and effects of currency crises.

 

 

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