PSD reviewing paper that alleges civil servants disproportionately bought homes near unannounced MRT stations

SINGAPORE – The Public Service Division (PSD) is reviewing a research paper published by a US-based non-profit organisation that said civil servants disproportionately bought homes near MRT stations that had not yet been publicly announced.

The PSD said on Sep 14 that it is looking at the data and methodology in the academic working paper and will refer any issue to the Corrupt Practices Investigation Bureau “if there is a material basis to do so”.

“We take any integrity concerns extremely seriously,” said a spokesperson from the department, which sits under the Prime Minister’s Office, in response to queries from the media.

The National Bureau of Economic Research (NBER), which is a private outfit headquartered in Cambridge, Massachusetts, published the working paper titled Do Social Norms Substitute for Enforcement? Evidence from Public Officials’ Home Purchases in Singapore in September.

The named authors of the paper are Tomasz Piskorski from Columbia University, Amit Seru and Chun Zhao from Stanford University, and Jian Zhang from the University of Hong Kong.

The authors said that they wanted to study whether pro-integrity social norms could substitute for formal enforcement in deterring misconduct by public officials.

The first line of their working paper stated that they “benefited immensely from discussions” with a list of individuals, including economist Li Shengwu, the estranged nephew of Senior Minister Lee Hsien Loong. 

Others thanked include several current and former academics at the National University of Singapore such as Sumit Agarwal, Jessica Pan, Ivan Png and Bernard Yeung.

The paper examines housing transactions around planned expansions of the MRT system, using what they describe as “universe-level housing transactions”.

The authors said they began their study by assembling private-property transactions from legal filings in Singapore, and linked buyers to the Singapore Government Directory Interactive – an online database of public officers – to identify civil servants and trace their transaction histories. 

They then focused on purchases near planned – but not yet publicly announced – MRT stations around announcement dates.

The authors found that purchase intensity near planned MRT stations was higher for civil servants than with a control group of non-civil servants with similar demographic attributes and housing consumption behaviours.

The effect was concentrated one to two years before public announcements and among mid-level officials and agencies connected to rail planning, said the paper.

The researchers said the pattern generated “meaningful private gains” and also appeared among relatives, which they said was consistent with information leakage.

The paper notes that as a working paper published by the NBER, it is “circulated for discussion and comment purposes”. It has not been peer-reviewed or been subject to the review by the NBER board of directors that accompanies official NBER publications.

Peer review is a scholarly process in which fellow experts or academics independently assess a paper for its validity and quality, among other factors. – THE STRAITS TIMES