2016 Annual Indices for Expatriates and Ordinary Residents on Cost of Living, Wages and Purchasing Power for World’s Major Cities


Authors : Khee Giap Tan (Lee Kuan Yew School of Public Policy, NUS, Singapore), Trieu Duong Luu Nguyen (Lee Kuan Yew School of Public Policy, NUS, Singapore), Divya Chandran (Lee Kuan Yew School of Public Policy, NUS, Singapore), Kong Yam Tan (Lee Kuan Yew School of Public Policy, NUS, Singapore)

Publisher : World Scientific

ISBN : 978-981-3227-20-0

"The Worldwide Cost of Living Index by the Economist Intelligence Unit was designed for human resources departments to figure out the cost of sending employees on business trips or to work overseas, often in a high-paying job. A group of academics at the National University of Singapore's (NUS) Lee Kuan Yew School for Public Policy made their own index, which distinguished between expats and locals. It found that for expats, Singapore was about the fourth most expensive city in the world. But for the 'ordinary residents', it was 48th, wedged between Lisbon and Pittsburgh."
-- Timothy McDonald
Journalist, BBC News

"The main contribution of the research done by ACI was that it can contribute to public policy as one cannot use expatriates for ordinary residents if public policy is the focus. In addition, though it is important to look at cost, the bigger concern is purchasing power. It does not matter if things are expensive as long as you can afford them. This is another point that I took away from the research and I was very happy to see that the team did purchasing power and not just cost of living."
-- Nicholas Khaw
Vice President, Khazanah Research & Investment Strategy, Malaysia
As cities continue to play an increasingly significant role in driving economic growth in many countries, competition among cities have shifted from the national level to the global arena. In this context, international benchmarks for cities are vital for businesses and individuals to make informed decisions. In particular, cost of living, wages and purchasing power are of great interest to employees, employers, multinational corporations and policy-makers as basic indicators tracking urban living standards.

This publication by the Asia Competitiveness Institute (ACI) provides annual indices and rankings for cost of living for expatriates as well as indices and rankings for cost of living, wages and purchasing power for ordinary residents in 103 global cities since 2005. The ACI's study reflects salient differences in costs of living for expatriate and ordinary urban dwellers which arise from variations in their lifestyles and consumption preferences. This is of critical significance as cost of living for the former is usually conflated as that for the latter by the general public. In this book, we also delve into the analysis of the nexus between liveability, cost of living and purchasing power. We outline the trends and patterns of these benchmarks and explore if there are trade-offs between liveability and affordability. The ACI's study has received considerable interest from reputable media outlets such as the British Broadcasting Corporation (BBC) and the Edge Malaysia.
Tan Khee Giap is a Co-Director of the Asia Competitiveness Institute (ACI) and Associate Professor at the Lee Kuan Yew School of Public Policy, National University of Singapore. He is also the Chairman of the Singapore National Committee for Pacific Economic Cooperation. Upon graduating with a PhD from University of East Anglia, England, in 1987 under the Overseas Research Scheme awarded by the Committee of Vice-Chancellors and Principals of the Universities of the United Kingdom, he joined the banking sector as a treasury manager and served as secretary to the Assets and Liabilities Committee for three years, thereafter he taught at the Department of Economics and Statistics, National University of Singapore, 1990–1993. Dr Tan joined Nanyang Technological University in 1993 and was Associate Dean, Graduate Studies Office, 2007–2009. Dr Tan has consulted extensively with the various government ministries, statutory boards and government-linked companies. He has also served as a consultant to international agencies such as the Asian Development Bank, Asian Development Bank Institute, United Nations Industrial Development Group, World Gold Council, ASEAN Secretariat, Central Policy Unit of Hong Kong, Kerzner International, Las Vegas Sands and Marina Bay Sands. Dr Tan is the lead author for 27 books, serving as journals editor and published widely in international refereed journals. His current research interests include econometric forecasting, Cost of Living Index, Global Liveable Cities Index and competitiveness analysis on 31 provinces in China, 35 states in India, 34 provinces in Indonesia and ASEAN-10 economies. Dr Tan was Deputy President of the Singapore Economic Society, 2004. He served in the 2002 Economic Review Committee (ERC), and was Chairman of the Task Force on Portable Medical Benefits (PMB) and Deputy Chairman of the IPS Forum for Economic Restructuring (IFER) in 2003. He is a member of the Resource Panel of the Government Parliamentary Committee (GPC) for Transport, GPC for Finance and Trade & Industry and GPC for Defence and Foreign Affairs since 2007. Dr Tan has extensively advised and guided multinational corporations leading to public listings especially those companies from Mainland China and Taiwan. He is also currently an Independent Director of the publicly listed BreadTalk Group, Boustead Projects, TEE Land and Chengdu Rural Commercial Bank.

Luu Nguyen Trieu Duong is a Research Associate at the Asia Competitiveness Institute (ACI), Lee Kuan Yew School of Public Policy (LKYSPP), National University of Singapore (NUS). Luu graduated from NUS in 2015 with a Second Upper Class Honours Bachelor of Social Sciences in Economics. Luu was a recipient of the ASEAN Undergraduate Scholarship and was placed on the Dean's List and Dean's Scholar List on separate occasions during his course of study. At ACI, he is the lead coordinator of the ACI's flagship project "Cost of Living, Wages and Purchasing Power Indices for Expatriates and Ordinary Residents in World's Major Cities", the lead coordinator of the project "Econometric Modelling of Domestic and External Engines of Growth for ASEAN Economies" and the co-coordinator of the ASEAN research cluster overseeing all projects related to ASEAN-10. He also participated extensively in the research on growth slowdown analysis by income thresholds and the study on the effects of exchange rate on foreign direct investments. Luu has co-authored journal articles, books and editorial-opinions on cost of living in world's major cities as well as economic development in ASEAN economies. Luu's research interests include growth and development, ASEAN economies, applied econometrics, international trade and public economics.

Divya Chandran is a Research Assistant at the Asia Competitiveness Institute (ACI), Lee Kuan Yew School of Public Policy, National University of Singapore. Prior to joining ACI, Divya worked as a Knowledge Broker at the UNDP Global Centre for Public Service Excellence in Singapore. She is also a Leadership mentor at Aidha — a Singapore NGO empowering female migrant workers and low-income women through financial literacy and entrepreneurship. At ACI, Divya is engaged in Indonesia's competitiveness study and FDI research at the provincial and regional level. Divya graduated from the London School of Economics and Political Science (LSE) with a second upper class honours in BSc International Relations; she is currently a Master in Public Policy candidate at the Lee Kuan Yew School of Public Policy. Divya's interests include labour migration, development economics, gender-responsive governance and international security.

Tan Kong Yam is presently Adjunct Professor at the Lee Kuan Yew School of Public Policy and Co-Director of the Asia Competitiveness Institute. He is also Professor of Economics at the Nanyang Technological University. Presently, he also serves on the boards of Changi Airport Group, Surbana-Jurong Private Limited, Ascendas-Singbridge Private Ltd and CapitaRetail China Trust Management Limited.

From 1985–88, he was the chief assistant to Dr Goh Keng Swee, the former deputy Prime Minister of Singapore invited by Mr Deng Xiaoping to advise China on economic development strategy. From June 2002 to June 2005, he was a senior economist at the World Bank office in Beijing. In 2004, he was a member of the World Bank expert group on the eleventh five year plan (2006–2010) for the State Council in China. The expert group provided analysis and policy recommendations to the Chinese government.

Prior to that, he was the chief economist of the Singapore government (1999–2002), Head, Department of Strategy and Policy of the NUS Business School, at the National University of Singapore (NUS). He is a graduate of Princeton (1975–79, class of 1931 scholar, Paul Volcker Thesis prize) and Stanford University (1980-83), where he completed his Master and PhD in three years. Prior to joining NUS, he has worked at the Hoover Institution at Stanford University, World Bank, the Monetary Authority of Singapore, and was the Director of Research at the Ministry of Trade and Industry in Singapore.

His research interests are in international trade and finance, economic and business trends in the Asia Pacific region and economic reforms in China. He has published ten books and numerous articles in major international journals including American Economic Review, World Bank Economic review, Long Range Planning, Australian Journal of Management etc on economic and business issues in the Asia Pacific region. He served as board member at the Singapore Central Provident Fund Board (1984–96) and the National Productivity Board (1989–90). He has also consulted for many organizations including Temasek, GIC, Citigroup, IBM, ATT, BP, ABN-AMRO, Ikea, Bank of China, China Construction Bank, People's Bank of China, EDB, Areva, Capitaland, Mobil, Singapore Technology, etc.
"The Worldwide Cost of Living Index by the Economist Intelligence Unit was designed for human resources departments to figure out the cost of sending employees on business trips or to work overseas, often in a high-paying job. A group of academics at the National University of Singapore's (NUS) Lee Kuan Yew School for Public Policy made their own index, which distinguished between expats and locals. It found that for expats, Singapore was about the fourth most expensive city in the world. But for the 'ordinary residents', it was 48th, wedged between Lisbon and Pittsburgh."
-- Timothy McDonald
Journalist, BBC News

"The main contribution of the research done by ACI was that it can contribute to public policy as one cannot use expatriates for ordinary residents if public policy is the focus. In addition, though it is important to look at cost, the bigger concern is purchasing power. It does not matter if things are expensive as long as you can afford them. This is another point that I took away from the research and I was very happy to see that the team did purchasing power and not just cost of living."
-- Nicholas Khaw
Vice President, Khazanah Research & Investment Strategy, Malaysia

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