The nature of wealth and university places

Ever wondered why some countries are richer than others? Or for that matter, what is wealth in the first place? What is money? Pieces of paper that everyone is dying to have? Is wealth something one attains at the expense of the other, which is why the rich is frequently associated with villains in movies?

Let's consider this question: Compared with 100 years ago, is the world wealthier now?

The answer is obvious. We are obviously richer. But I am too lazy to find data to back it up anyway.

Then the next question is : How did that happen? How could everyone be richer at the same time?

To answer that, let's examine the achievements of Henry Ford. Henry Ford is also known as the father of modern assembly lines used in mass production. What he did was make more cars than anyone else, faster than anyone else, cheaper than anyone else. Before Henry Ford, cars were only affordable to the rich. It was simply priced out of reach to the common folk. The superior production speed and cost made possible by the modern assembly lines meant that the real price of cars fell dramatically such that the working class could afford it. By 1927, 15 million Ford T models were sold, a record that stood for the next 45 years.

Something similar happened to the poultry industry. Tremendous genetic gain was achieved through breeding, enabling chickens to lay twice as many eggs, grow twice as large while consuming half the feed (abit exaggerated but the idea is there). The switch from backyard chicken farmers to the modern day chicken farms easily housing a million chickens resulted in reduced production costs and partly contributed to the decline is real price for eggs and chicken meat.

But this is only half the story. Lowering the cost of input and increasing the efficiency of the transformation process alone is not sufficient to create a wealthy world. For what's the use of producing goods that nobody wants? This is a waste of time and time is actually money in disguise. Money is actually time converted to a physical form. You spend time to work for your boss and in exchange for your time, he gives u money. Similarly, producing too few of goods that people want or need is also a waste of time. Why? It's because the price of the goods will be unnecessarily inflated. The real price of the goods will be increased and if you pay more money, you are paying out more time. Imagine a situation with a shortage of food supply. You will need to pay twice as much time to get half the amount of food.

So after all this rambling, what's the link about all these to university places? Recently, there was a minor outcry over the perceived lack of university places allocated for Singapore students.
Before an analysis is made on the issue of whether there should be more places more places of Singaporean students in Singapore universities, let's revisit the current situation on medical and law industries in Singapore.

On 30th March 2007, the Ministry of Health released a press statement regarding the "Expansion in the number of recognised Foreign Medical Schools". Therefore, it is save to assume that Singapore faces a shortage in doctors. This in turn means that 7 years ago (5 years of medical training + 2 years of internship) and before that, Singapore was training too few doctors. How many straight As students were rejected from the medical course in Singapore? And what's the effect of this? I suppose those rejected from medical course took up and engineering course or business course instead, displacing other students who wanted to do these courses but were at the lower end in the results spectrum. A top down effect, rather like dominoes ensues with the students right at the bottom of the chain left without a place in University. And what are the options left for such students? Retake their A'levels? Get a place in a polytechnic? Or maybe go overseas for a tertiary education if they can afford it?

Improper allocation of resources would have occured in such a situation, at many levels. Many potential doctors miss out on the chance to be one. Too many engineers taken in as a result? And those at the bottom end of the A'level results spectrum go without a place in a university.
And with the shortage of doctors, everyone pays more for medical care, perhaps too much. And with the excessive numbers of engineers, isn't this a case with excessive "goods" that's unwanted? And how about those with the ability to complete a so-called "easier" course in the university but missed out on the opportunity to do so?

The same has happened to the law industry. And with Singapore's obsession with paper qualifications, perhaps we will have too many waiters, cleaners, construction workers etc. (those without sufficient paper qualifications) Or is that already happening?

And all the parroting about human resources being the only resource Singapore has, perhaps more needs to be done to develop Singapore's people as efficiency and productivity alone cannot lead to great wealth.