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 Institutional complementarities encourage
actors to focus on the long or short-term strategy. By examining Singapore’s
business model, the state and family-owned businesses lean towards the
long-term strategy. Although the stock market is relatively big in comparison
to Singapore’s GDP, the enterprises are still state and family-owned, they are
not required and pressured to achieve specific quarterly expectations in
contrast to the US market. The long-term strategy is produced by the remaining
short-term institutions such as Social Capital, internal firm structure,
education and skills, employment relations and inter-firm relations. Whereas
the internal firm structure focuses on the decision-making by the top
executives. These executives have the authority power to hire and fire
employees, balance the educational system and so on (Carney, 2015).

            Innovation is one of the main implication
of these institutional organizations for high-income nations. The state has
addressed that research and development in niche areas must continue and the
innovation will be one of the determinations of Singapore’s future growth.

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Although Singapore has become a technological frontier, the innovation strategy
is driven by multinational corporations. Therefore, the nation still lacks its
own innovation within local businesses. The state has tried to implement
several initiatives to boost innovation such as educational programs, start-ups,
and research financing, but the implementations have so far given undesirable
results (Carney, 2015). The weak results are due to the lack of poor culture
and creativity. In addition, the state does not have the encourage to take risks
and to promote interpersonal relations. Singapore needs to develop more
ambitious CEOs with individual and open mindsets, who can secure an
innovation-friendly environment for the future generation. The state tends to
favor low-risk and long-term strategies to pursue innovation. This strategy has
undermined future generations to take risks in innovation, which most likely
will result in unsustainable innovative growth and activity.


By applying and expanding the scope
of the VoC model, the role of the state plays a significant important role in
decision-making within the city-state of Singapore. The political system is a hybrid
regime which is most likely to arise under strong presence of a state. Under
the strong directive of the PAP government, the state is actively supporting
firms in solving problems associated with inter-firm relations, corporate
governance, employee relations and educational programs. Institutions such as
the NTUC, SNEF and government-linked corporations under Temasek Holdings has
provided this study a deeper historical and explanation of its economic and
political business model. The complementarities have provided stability,
trained and disciplined workforce within the city-state, which is a fundamental
quality for foreign investors who seeks to invest in the region. Despite these
qualities, the complementarities have also created challenges in Singapore’s
local innovation abilities.

To sum up, Singapore’s success of the
state-led capitalist economic model has been practical in order to expand the
scope of the VoC model.  The state’s
authoritative economic role is much more influential in comparison to other
nations. The importance of the state’s role concludes that it occupies a
position of analytical importance that has thus far eluded mainstream VoC




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