- Title
- Determinants of inclusive growth in South Africa: a macroeconomic approach
- Creator
- Makala, Zizo https://orcid.org/0000-0002-4875-6531
- Subject
- Economic development -- South Africa
- Subject
- Macroeconomics -- South Africa
- Date
- 2022-08
- Type
- Master's/ theses
- Type
- text
- Identifier
- http://hdl.handle.net/10353/28761
- Identifier
- vital:74913
- Description
- Available literature substantiates that economic growth is imperative but not sufficient to improve the living standards of a substantial percentage of South Africa’s population. The benefits of growth are also barely equitably distributed among the different groups of society in South Africa. Based on this background, the study empirically examines the factors that determine inclusive growth in South Africa. The study utilised annual data from 1991 to 2020, employing the autoregressive distributed lag model (ARDL) bounds testing approach to cointegration to evaluate the long-run and short-run linkage among the variables of interest. Based on the Social Opportunity Function, a model linking inclusive growth and its determinants was specified. The empirical results suggest a positive relationship between Foreign Direct Investment (FDI) and inclusive growth (LGDPPPE), in both the short run and the long run, implying that, FDI inflows significantly drive inclusive growth. Therefore, there is a need for South Africa to open economic borders to benefit from the opportunities for inclusive growth through external capital. In contrast, Inflation (INFL) portrays a negative influence on LGDPPPE, both in the short and long run alike, suggesting that the rate of inclusive growth is higher when inflation rate is lower, leading to the implication that, to significantly help accelerate inclusive growth in South Africa, the control of inflation must be a major object of economic policy. In the short run, the Level of Income (LGDPPC), Government Consumption (GGFCE), Population Growth (POPG), Gross Fixed Capital Formation (GFCF), and Trade Openness (TOP) indicate no noticeable influence on LGDPPPE. However, in the long run, LGDPPC, POPG and TOP turned out positive and statistically significant. This finding suggests that policies that make the South African economy open to trade with the rest of the world are essential for inclusive economic growth. Furthermore, the finding implies that population growth is not detrimental to growth inclusiveness in South Africa and policy measures that enhance the population’s productivity to reap demographic dividends should be encouraged.
- Description
- Thesis (MCom) -- Faculty of Management and Commerce, 2022
- Format
- computer
- Format
- online resource
- Format
- application/pdf
- Format
- 1 online resource (108 pages)
- Format
- Publisher
- University of Fort Hare
- Publisher
- Faculty of Management and Commerce
- Language
- English
- Rights
- rights holder
- Rights
- All Rights Reserved
- Rights
- Open Access
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UFH Department of Economics
| Thumbnail | File | Description | Size | Format | |||
|---|---|---|---|---|---|---|---|
| View Details Download | SOURCE1 | Makala_201312291_Economics.pdf | 1 MB | Adobe Acrobat PDF | View Details Download |