The Exemplar's Curse and Singapore

Like the optimizer’s curse, if we try to make policy decisions based on exemplars, we may systematically mislead ourselves by picking the luckiest polities rather than the wisest. If we try to replicate the policies of these lucky polities, regression toward the mean suggests we’ll meet with disappointment. This theory might apply to Singapore.

The exemplar’s curse

A parable

Suppose you walk into the nearest WalMart, get on the PA, and ask everyone to congregate in the attached warehouse. Once the congregation has settled, you reveal a ream of printer paper, ask everyone to fold their best paper airplane, and finally ask everyone to toss their planes as far as they can. Once everyone’s tossed, you pull out your handy-dandy tape measure and determine which plane flew the farthest.

So far, so good. However, if you then proceed to marvel at the winning plane and attribute its long flight to the artful pattern of creases, you’re likely to err. Because, of course, there’s a substantial element of luck (meant in a casual sense; let’s not careen off on a tangent about determinism) in the outcome of the contest—it’s not a pure contest of skill. And in choosing the extreme value (the winner), we’ve positively selected for luck. This means our winner will likely have better than average luck. This result—in contests where many contestants are skilled, the outcome is often determined by luck—goes by the name the paradox of skill.

The unfortunate conclusion to this parable is that we should expect planes modeled after our winner to do worse than the original. Because the winner was unusually lucky, subsequent flights will experience reversion to the mean and perform worse.

Or, another route to this intuition: Even if you ran the contest again with the exact same planes, a different pattern of air drafts, a different incidental flick of the wrist might well result in a different victor. It’s only after we’ve run many trials and looked at the pattern of results for each plane that we can bring the risk of a false victor down to acceptable levels. If luck is a significant factor and there are many contestants, chances are that this true, final victor is not the same as the plane that happened to win the first trial. This is why sporting events often have multiple matches in a series—to diminish the impact of luck and suss out skill.

Abstracted

Summarizing, the exemplar’s curse occurs when you’re selecting an exemplar from a set of outcomes which resulted from both stochastic and deterministic factors. If many outcomes have similarly compelling deterministic factors1, the chosen winner is probably unusually lucky. Regression to the mean then suggests that the chosen winner will disappoint when the deterministic factors are replicated.

Optimizer’s curse

The following is offered as an extra in case it helps. If it doesn’t, dismiss it with prejudice:

The perspicacious reader will have noticed that this is just the optimizer’s curse dressed up in causal clothes (Smith and Winkler 2006). The paradigmatic optimizer’s curse warns about the difficulty of selecting actions based on the predicted value of the action. In such circumstances, naive optimizer’s will likely be disappointed because they will systematically pick actions based on overoptimistic predictions. (If this explanation doesn’t do it for you, you can just read the beginning of the linked paper; it’s not bad.) Our exemplar’s curse is structurally similar—we just have uncertain causal inference about the past instead of uncertain predictions about the future.

Singapore as exemplar

With that bit of groundwork laid, we can return to our discussion of Singapore. Could this be an exemplar’s curse? Our criteria were: Selecting on an extreme, outcome determined by both stochastic and deterministic factors, several candidates with similarly compelling deterministic factors. Looking at our criteria we see that:

  • We’re looking at Singapore because it has extremely high, sustained growth.
  • I am not a historical determinist so I do believe that luck plays a role in the course of history and in development. Another route to the claim that there’s luck in development is just to point out that all our existing growth models have residuals. No model has yet identified all the causal factors for growth and squeezed out the stochastic remainder.
  • It’s hard to know whether other polities besides Singapore have similarly effective (though different) policies, institutions, and other deterministic factors. But I don’t think we can rule out that possibility. To do so would be to beg the question.2

For fun, here are some excerpts that sounded like Singapore getting lucky3 to me (Yew 2012):

I told Keng Swee to proceed with the Israelis [training the early Singapore armed forces], but to keep it from becoming public knowledge for as long as possible so as not to provoke grassroots antipathy from Malay Muslims in Malaysia and Singapore. [It worked.]
In Jakarta, an Indonesian crowd rampaged through the Singapore embassy, shattering pictures of the president of Singapore and generally wreaking havoc, but did not burn the embassy.
Our break came with a visit by Texas Instruments in October 1968. They wanted to set up a plant to assemble semiconductors, at that time a high-technology product, and were able to start production within 50 days of their decision. Close on their heels came National Semiconductor. Soon after, their competitor, Hewlett-Packard (HP), sent out a scout.
The new [political opponents] were lacklustre and did not measure up. Chiam was constructive and could have built up a sizeable political party had he been a shrewder judge of people. In 1992 he proudly produced a plausible young lecturer as his prize candidate for a by-election. Within two years, his protégé had ousted him as the leader and forced him to form a new party.

We then agreed to a Malaysian proposal that one Malaysian regiment be sent down to Camp Temasek. The 2nd battalion SIR was due to return from its duties in Borneo in February 1966, and arrangements were made at staff level for the Malaysian regiment to withdraw. The Malaysian defence minister requested that instead of reoccupying Camp Temasek, one Singapore battalion should be sent to the Malayan mainland to enable the Malaysian regiment to remain where it was. Keng Swee did not agree. We wanted both our own battalions in Singapore. We believed the Malaysians had changed their minds because they wanted to keep one battalion of Malaysian forces in Singapore to control us. The Malaysians refused to move out, so the SIR advance party had to live under canvas at Farrer Park.

[…]

Shortly afterwards, the British vacated a camp called Khatib in the north of Singapore, near Sembawang. We offered it to the Malaysians and they agreed in mid-March 1966 to move out of our camp to Khatib, where they remained for 18 months before withdrawing of their own accord in November 1967.

Implications

If we believe this story that Singapore suffers from the exemplar’s curse, how should we respond? It means that we should be a little more cautious in trying to generalize the successes of Singapore. The institutions and policies that seemed successful there might result in more average outcomes when replicated elsewhere.


Smith, James E, and Robert L Winkler. 2006. “The Optimizer’s Curse: Skepticism and Postdecision Surprise in Decision Analysis.” Management Science 52 (3). INFORMS: 311–22. https://faculty.fuqua.duke.edu/~jes9/bio/The_Optimizers_Curse.pdf.

Yew, Lee Kuan. 2012. From Third World to First: The Singapore Story, 1965-2000. Vol. 2. Marshall Cavendish International Asia Pte Ltd.


  1. Why is this condition necessary? Here’s an easy example. If you only trial two airplanes, one carefully folded and streamlined, and the other just a sheet paper with a single fold down the center, (almost) no amount of luck will let the latter win.

  2. Am I just begging the opposite question? I said we shouldn’t assume Singapore’s deterministic factors are distinctly better than those of other polities in an attempt to wriggle out of the exemplar’s curse. Why then am I allowed to assume that Singapore’s deterministic factors aren’t better in defense of the exemplar’s curse? My reply is that I’m not making the positive claim that Singapore is the same as other polities—just that I’m uncertain so it might be the same and so the exemplar’s curse might apply.

  3. Obviously, I don’t mean to imply that any of these events turned out favorably due only due to luck. It merely seems to me that, if circumstances had been slightly different, a worse outcome would have obtained and the People’s Action Party would have been largely powerless to avoid this worse outcome.