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The scale-up state: Singapore’s industrial policy for the digital economy

Author

Listed:
  • Lee, Neil
  • Ni, Metta
  • Boey, Augustin
Abstract
The Singaporean state has played a crucial role in the country’s economic development. This led to concerns that a state-steered economy would be unable to develop fast-changing, disruptive sectors that are reliant on individual entrepreneurship, such as digital technology. Yet Singapore has become a world leader in the scaling of digital technology firms. In this paper, we consider how this happened. We show that advances in ICT opened a window of locational opportunity in digital tech, which was spotted by Singaporean policymakers open to experimentation. A distinctive ‘Singapore model’ developed to take advantage of this opportunity, exploiting Singapore’s geographical position, open economy, and business environment but combining this with active state intervention. To address coordination problems in the creation of an entrepreneurial ecosystem, Singaporean policymakers worked through a process we term ‘network coordination’ across the whole of government. While overall rates of entrepreneurship remain low, the country has been successful at scaling firms in the digital technology sector. These primarily focused on consumer applications and non-Singaporean markets, but there has been little development in frontier ‘deep tech’.

Suggested Citation

  • Lee, Neil & Ni, Metta & Boey, Augustin, 2024. "The scale-up state: Singapore’s industrial policy for the digital economy," LSE Research Online Documents on Economics 123885, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:123885
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    File URL: http://eprints.lse.ac.uk/123885/
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    References listed on IDEAS

    as
    1. Adams, Stephen B., 2011. "Growing where you are planted: Exogenous firms and the seeding of Silicon Valley," Research Policy, Elsevier, vol. 40(3), pages 368-379, April.
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    3. Wang, Jue, 2018. "Innovation and government intervention: A comparison of Singapore and Hong Kong," Research Policy, Elsevier, vol. 47(2), pages 399-412.
    4. Natasha Hamilton-Hart & Henry Wai-chung Yeung, 2021. "Institutions under pressure: East Asian states, global markets and national firms," Review of International Political Economy, Taylor & Francis Journals, vol. 28(1), pages 11-35, January.
    5. R. Boschma, 1996. "The window of locational opportunity-concept," Working Papers 260, Dipartimento Scienze Economiche, Universita' di Bologna.
    6. David B. Audretsch & Antje Fiedler, 2023. "Does the entrepreneurial state crowd out entrepreneurship?," Small Business Economics, Springer, vol. 60(2), pages 573-589, February.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    digital technology; Singapore; developmental states; industrial policy; entrepreneurial ecosystems;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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