Housing market dynamics and economic growth in South Africa (1994 – 2019)
- Authors: Muchaonyerwa, Forward
- Date: 2023-09
- Subjects: Economic development -- South Africa , Housing -- Prices -- South Africa , Housing forecasting -- South Africa
- Language: English
- Type: Doctoral theses , text
- Identifier: http://hdl.handle.net/10353/28628 , vital:74477
- Description: The housing market contributes significantly to economic growth. On this background, the study examined South Africa’s housing market dynamics, particularly determinants of demand, supply, and formal housing prices. Furthermore, the study looked at the impact of housing prices on economic growth from 1994:Q1 to 2019:Q2. The study period is important as it covers the new political dispensation in South Africa where the country entered a new democracy in 1994. The first three objectives of the study were to identify the determinants of housing demand, supply, and prices. The theory of demand and supply provided the theoretical framework for these models. Estimation of the housing demand, supply and price models was done by the employing Seemingly Unrelated Regression (SUR) technique. The Three Stage Least Squares (3SLS) model was estimated for robustness. Findings from SUR and 3SLS confirmed that Housing Demand (HD) is negatively and significantly influenced by residential Building Costs per Square Meter (BCSM), Housing Supply (HS) and Financial Costs (FC); and positively influenced by House Prices (HP). In addition, HS is negatively affected by BCSM, HD, Production Costs (PC) and Urban Population (UP); and positively influenced by HP and Residential Construction Confidence (RC). Lastly, HP are negatively affected by Prime Overdraft Rate (POR) and RC; and positively influenced by BCSM, HS, HD, Coincident Business Cycle Indicator (CBC) and residential Valuation (VAL). The fourth objective was to examine the impact of house prices on economic growth. An economic model was specified with Gross Domestic Product (GDP) as its dependent variable. The new growth theory provided the theoretical framework for this model. The Johansen co-integration technique confirmed a long run-term relationship between economic growth and house prices. The Vector Error Correction Model (VECM) was estimated to analyze the long and short run relationship among the variables. Empirical results confirmed that house prices have a positive impact on economic growth. Results further confirmed that CBC and Unemployment Rate (UR) are also positively related to GDP. POR and Leading Business Cycle indicator (LEBC) are negatively related to GDP. Granger Causality test was performed to analyze the causality between house prices and economic growth. The results indicated that there is a long run unidirectional causality from house prices to economic growth. With these results, the study recommends policy formation emanating from continuous research by establishing a human settlement agency or task team. The team can establish procedures for data collection and maintain a database for all kinds of housing market data. Their mandate includes research on commissioning of new towns and/or cities to boost housing supply. The government should avail more land and relax restrictive regulations and minimize red tape to ensure that houses are supplied to meet the growing demand as well as to stabilize prices. Policies to promote confidence and stabilize building costs are needed. These variables indicated significant influence on housing dynamics. It is also recommended to incentivize households to participate on the mortgage market. This assist both households through the wealth effect which positively influence increase in economic activity in South Africa. , Thesis (DCom) -- Faculty of Management and Commerce, 2023
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The impact of domestic investment on economic growth in South Africa: a Sectoral Approach (1993 to 2020)
- Authors: Hobongwana, Khungile Goodwell https://orcid.org/0000-0003-0223-7370
- Date: 2023-01
- Subjects: Economic development -- South Africa , Investments -- South Africa , Gross domestic product
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10353/26753 , vital:65982
- Description: This study examined the impact of domestic investment on economic growth in South Africa: a sectoral approach from 1993 to 2020. The overall results as discussed by panel data ARDL revealed that domestic investment has an impact on at least one sectoral economic growth in South Africa in the long run. The panel data ARDL test reveals that domestic investment, employment, imports and exports have a significant correlation to influence GDP in the long run in at least one of the sectors. A pairwise Dumitrescu Hurlin panel causality tests determine that domestic investment (DI) does not homogeneously cause gross domestic product (GDP). This is because in South Africa the sectoral or structural change development relies much on foreign direct investment (FDI) rather than domestic investment, hence the negative homogeneous results. Therefore, we need to attract DI as the result shows, because a positive relationship can be expected between domestic investment and economic growth in line with the Keynesian theory where investment is expected to promote economic growth. The new-endogenous growth theory of investment that can be applied in detecting the effect of aggregate and disaggregate domestic investment on sectoral economic growth and aggregate economic growth. , Thesis (MCom) -- Faculty of Management and Commerce, 2023
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Determinants of inclusive growth in South Africa: a macroeconomic approach
- Authors: Makala, Zizo https://orcid.org/0000-0002-4875-6531
- Date: 2022-08
- Subjects: Economic development -- South Africa , Macroeconomics -- South Africa
- Language: English
- Type: Master's/ theses , text
- Identifier: http://hdl.handle.net/10353/28761 , 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. , Thesis (MCom) -- Faculty of Management and Commerce, 2022
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Human Resource Development model for cultivating a culture of innovation in local government: the case of Buffalo City Metropolitan Municipality, South Africa
- Authors: Mutangabende, Shepherd https://orcid.org/0000-0003-3231-7400
- Date: 2022-08
- Subjects: Local government -- South Africa -- Eastern Cape , Economic development -- South Africa , Local government -- Technological innovations -- South Africa
- Language: English
- Type: Doctoral theses , text
- Identifier: http://hdl.handle.net/10353/28817 , vital:75128
- Description: Local government in South Africa is grappling with transforming democratic, accountable, and sustainable service provision to communities. Human Resource Management (HRM) plays an instrumental role in cultivating an innovative public service culture. It enables such a culture through workforce planning, recruitment, selection, induction, rewarding, budget allocation, training, and development. A culture of innovation provides an opportunity for local government to respond to pressing local needs within legislative and financial constraints. This study adopted a pragmatic research philosophy, and an exploratory sequential mixed methods research strategy and case study research design, to investigate human resources development strategies for cultivating a culture of innovation in local government, using a case study of Buffalo City Metropolitan Municipality, in South Africa. Qualitative data was collected from twenty (n=20) purposefully sampled information-rich participants through indepth interviews and quantitative data from eighty (n=80) line officials using a structured questionnaire. Research findings indicate that HRM in BCMM is not optimally utilising HRM strategies to cultivate a culture of innovation. Study results show insufficiency of qualified human capital, which therefore, impose constraints on the capacity of the municipality to optimally cultivate a culture of innovation. Findings show that participants in leadership positions often lacked requisite knowledge and capacity on workforce planning, which is necessary for human capital needs analysis and for identifying skills gaps, which would subsequently inform recruitment and selection, induction, and human resources development of municipal human capital. Recruitment and selection processes as well as induction programmes are also often devoid of innovation human resources development practices and strategies. There were often not much rewards for employees who come up with innovative ideas or methods of executing their key performance areas. Lack of rewards was a barrier to innovation as the question of “what is in it for me?” remain unanswered. This could be the reason why there were few innovative activities taking place in local government and the case study municipality. Results further suggest that the organisational culture of the case study municipality was mostly conservative, as employees did not have fecund opportunities for trial and error of new methods of executing performance tasks, often strictly adhering to standard operating procedures. The organisational culture in the case study municipality was thus risk aversive, and a significant barrier to innovation. There was often poor communication on the availability of budget allocation for innovation. The study, therefore, recommended more effective and innovative workforce planning and using that information during recruitment and selection. It also recommended using rewards to motivate employees to be innovative, allowing trial and error, to test new ideas and methods as ways of cultivating a culture of innovation. There is thus a significant need and demand for transformation and innovation in local governance, heightened by increasing municipal dysfunction and citizen expectation. As such, providing human capital with requisite knowledge and skills, retaining talent, and inducing human resources to be immobile, build up high performance work systems (HPWS), essential for achieving sustainable local government functionality and municipal performance. Human Resource Development thus play a significant role, as it essentially provides training and development programmes to equip workers with innovative skills needed in local government. The study thus developed and recommended a human resource development model which could be contextually adapted by municipalities to cultivate and foster a culture of innovation for optimum municipal functionality. , Thesis (DPA) -- Faculty of Management and Commerce, 2022
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The effects of household agricultural income on the adoption of electrical appliances and energy security among rural households in Mnquma Local Municipality
- Authors: Ntonjane, P https://orcid.org/0000-0001-9432-9031
- Date: 2021-09
- Subjects: Energy security , Sustainable development -- South Africa , Economic development -- South Africa
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10353/22655 , vital:52617
- Description: Energy security is critical to global economic development and agricultural activities. Electricity is one of the most beneficial types of energy for rural household livelihoods and smallholder producers in South Africa. This study aims to examine the effects of household agricultural income on the adoption of electrical appliances and energy security among agricultural households in Mnquma Local Municipality. The study employed primary data obtained from 224 households using simple random sampling technique across three electrification stages. Descriptive statistics, and binary logistic regression was used to determine the relationship between socio-economic and demographic characteristics of the household and the household agricultural income on the adoption of new electrical appliances and energy security across the three electrification stages. Descriptive statistics results indicated that non-electrified (67.1percent) and recently electrified (54.3percent) villages are dominated by female-headed households, while in electrified households there are more male head households (58.3percent). The results also show that among the households that have the highest total monthly income (greater than R15000), 34.5percent were electrified, 17.1 percent were recently electrified, and 4.3percent were non-electrified. The Binary logistic regression model's findings for the second objective revealed that household head factors such as age, monthly total household income, household size, and household agricultural income have significant effects on energy security. The study's findings revealed that household agricultural income has a significant impact at a 5 percent significant level on the adoption of electrical appliances. Binary logistic regression findings for the third objective revealed that on new electrical appliance adoption there was a significant effect of gender (at 5percent level), household size, energy security, and household agricultural income at a 1percent significance level. Binary logistic regression revealed that the coefficient of household size variable is positive and significant at a 1percent significant level on energy security and electrical appliance adoption. In this study, household agricultural income on the adoption of electrical appliances has been found to be the most critical factor influencing the energy security status of households among the selected rural households in Mnquma Local Municipality. As a result, policies must be put in place to facilitate access to electrical appliances through electrification programs, invention of affordable electric appliances, encourage participation in agricultural production and agricultural market access, that will provide households with social benefits. To improve energy security, electrical appliances should be simple to use and aid in the transition from biomass to electricity. , Thesis (MAgric) -- Faculty of Science and Agriculture, 2021
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Market participation and welfare of smallholder farmers in the Eastern Cape Province South Africa
- Authors: Lesala, Mahali Elizabeth https://orcid.org/0000-0001-9921-2190
- Date: 2021-06
- Subjects: Farms, Small , Economic development -- South Africa , Agriculture -- Economic aspects -- South Africa
- Language: English
- Type: Doctoral theses , text
- Identifier: http://hdl.handle.net/10353/20916 , vital:46745
- Description: The low market participation of smallholder farmers in markets has received enormous attention from scholars, both in the country and the Eastern Cape Province. However, it is not clear how low their market participation is including its implications on farmer’s welfare. The purpose of the study was to determine the extent to which smallholder farmers in the homelands of the Eastern Cape participate in output markets and assess how their participation in markets has affected wellbeing of their households. This information will have important practical implications for policy regarding appropriate pathways for poverty alleviation and livelihoods improvements in the rural areas of the Eastern Cape Province. Three irrigation schemes; Qamata, Zanyokwe and Tyefu irrigation schemes were selected for this study. A sample of 210 smallholder irrigators were interviewed by means of a close-ended questionnaire. The data were analysed by means of descriptive statistical tools, the multiple-level choice models and the Propensity Score Matching (PSM) technique. SPSS and STATA computer programmes were used to carry out all the estimations. The analysis established that, although agriculture is the primary activity for rural livelihoods, it is not the main contributor to family income. Rather, remittances and social grants were the dominant sources of household income in the Qamata, Zanyokwe and Tyefu areas. From the standpoint of market, maize and potatoes are the most popular crops, but potatoes dominate the market. This result confirms that maize is the staple crop and therefore mostly grown for home consumption while production of potatoes is market-oriented. The Market Participation Index (MPI) revealed that farmers sell at least 55 percent of their farm produce, implying that farmers have made some transition from subsistence to semi-commercial farming. However, farmers’ priority still remains food self-sufficiency and market participation only takes place after satisfying their home food needs. The results revealed that the significant factors influencing the farmers’ decisions and their extent of participation in output markets were the age, gender, marital status of the household head, primary occupation of household head, size of farm cultivated, government financial support, access to extension services and farmer’s membership of cooperatives. Concerning the impact of output market participation on welfare of smallholders, the Average Treatment on the Treated (ATT) as the measure of change revealed that participation in output markets has a positive impact on welfare of the smallholder farmers through increased incomes. Farmers who participated in output market were at least R838.44 better off than those who did not participate in markets although social grants and remittances made significantly higher contribution to household welfare. The study suggests that despite some improvements in income of market participants, the standards of living of the rural households are still far from what would be considered optimal. Crop farming evidently contributes less than desired, hence the persistence of the widespread poverty. It is urgent to focus interventions on improving agricultural productivity while widening strategies for improving rural livelihoods beyond agriculture to diversify the choices open to rural dwellers. , Thesis (PhD) -- Faculty of Science and Agriculture, 2021
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A critical assessment of economic policies and their impact on entrepreneurship development in South Africa: a case of Khayelitsha Township in Cape Town
- Authors: Oduwole, Olusola https://orcid.org/0000-0002-1563-7392
- Date: 2015
- Subjects: Entrepreneurship , Economic policy , Economic development -- South Africa
- Language: English
- Type: Doctoral theses , text
- Identifier: http://hdl.handle.net/10353/26302 , vital:65236
- Description: The complexity of the South African society due to past systematic exclusion of some communities from economic activities resulted in the triple challenge of poverty, inequality and unemployment. Although various economic policies had been developed since the advent of the democratic dispensation in 1994, these policies focused on levelling the economic environment, poverty alleviation and massive social security system. However, despite all the interventions, South Africa remains one of the most unequal societies in the world. This is profiled by the mushrooming of informal settlements around cities with job seekers and frequent protests by people who are impatient to experience improvement in their quality of life and who feel cheated out of their social contract. Advocacy from the governing party’s tripartite alliance towards a developmental state had placed more obligations on the government. This requires deliberate interventions through policies implementation to improve or at best alleviate the well-being of the citizenry. A survey conducted in the township of Khayelitsha to assess the impact of such economic policies on the development of entrepreneurship. Khayelitsha is one of South Africa’s largest townships, an informal settlement profiled by unemployment, poor infrastructure and unavailability of basic services. The study explored the entrepreneurial perception, start-up barriers, entrepreneurship climate, and general cultural factors relating to the environment of entrepreneurship development. The results reveal that despite the various economic policies, high level of unwillingness of citizens towards entrepreneurial activity and business venture is rife notwithstanding the high level of unemployment and poverty. The antidote to these challenges would be a rapid entrepreneurship drive among people most affected that would cause them to mind their own business” and become “masters of their own destinies. Given the complexity and massiveness of the challenges, the conclusion shows that a pragmatic solution is required. Therefore, the emancipation of entrepreneurship development in South Africa townships needs attention. The recommended solution is a pragmatic and innovative strategy based on the acronyms NEEDS HELP which stand for Neighbourhood Enhancement and Environmental Development Strategy and Holistic Entrepreneurial Lifestyle Programme. , Thesis (PhD) -- Faculty of Management and Commerce, 2015
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The impact of globalization on economic growth in South Africa
- Authors: Maronga, Vimbai Linah
- Date: 2015
- Subjects: Economic development -- South Africa , International economic integration , International trade
- Language: English
- Type: text
- Identifier: http://hdl.handle.net/10353/25861 , vital:64552
- Description: The dissertation investigated the impact of globalization on the economic growth of South Africa using annual South African data covering the period 1975 to 2011. The study used Johansen cointegration and vector error correction model to determine the impact of globalization on economic growth in South Africa. The VECM model with South African variables was specified and used to assess the effects of globalization on South Africa’s economic growth. Results of the study suggested that the South African economic growth was negatively impacted by globalization in the long run. Using the results conclusions and policy recommendations were made using these results. , Thesis (MCom) -- Faculty of Management and Commerce, 2015
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The effectiveness of business incubators in enhancing growth, survival and performance of small, medium and micro enterprises in the Eastern Cape province, South Africa
- Authors: Sarakunze, Annie.
- Date: 2014-11
- Subjects: Entrepreneurship , Economic development -- South Africa , Small business
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10353/26786 , vital:66005
- Description: In both developed and developing countries, the growth of Small, Medium and Micro Enterprise sector is considered an important factor in boosting the economic well-being of a country. The governments of many countries play a basic role in creating policies and programmes which support the growth of Small, Medium and Micro Enterprises. One of the initiatives used by the governments to nurture small businesses is business incubation.This study investigated the effectiveness of business incubators in enhancing growth, survival and performance of Small, Medium and Micro Enterprises (SMMEs) in selected areas of the Eastern Cape Province. The objectives of this study were to assess the impact of business incubation on the performance of SMMEs, determine the impact of business incubation on the growth of the SMME, to assess the impact of business incubation on the survival of the SMMEs and to investigate whether SMMEs are satisfied with the role of business incubators in their areas.This study employed a stratified simple random sampling technique. The population was first divided into six homogeneous strata and then simple random sampling was then employed. The self-administered questionnaires were then distributed into each and every stratum randomly. Simple random sampling was used because it enabled each and every member in the strata to have an equal chance of being selected. Owners, managers and employees were used as respondents in this study and a total sample of 200 SMMEs answered the questionnaire. The study followed a quantitative research design as it involved variables such as growth, firm performance and survival which have measures that involves the use of figures such as sales, number of employees and total value of assets. The data was analysed by Anova, Pearson Chi-Square and T-test statistical methods in order to arrive at findings and conclusions. Based on the findings from this survey it was found that business incubators are effective in enhancing growth, survival and performance of SMMEs. Although other researchers found that there are no significant variations in growth, survival and performance of incubated and non-incubated businesses, this study however recognizes the importance of business incubation to SMMEs. This study concurs with most findings by many researchers of business incubation and thus recommends vigorous business incubation awareness to the SMMEs and networking. , Thesis (MBm) -- Faculty of Management and Commerce , 2014
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The effect of real exchange rate volatility on export performance: evidence from South Africa (2000-2011)
- Authors: Chamunorwa, Wilson
- Date: 2014
- Subjects: Monetary policy -- South Africa , Economic development -- South Africa , Foreign exchange rates -- South Africa
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11499 , http://hdl.handle.net/10353/d1018600 , Monetary policy -- South Africa , Economic development -- South Africa , Foreign exchange rates -- South Africa
- Description: The effect of real exchange rate volatility on export performance: evidence from South Africa (2000-2011) This study sought to investigate the relationship between exchange rate volatility and export performance in South Africa. The main objective of the study was to examine the impact of exchange rate volatility on export performance in South Africa. This relationship was examined using GARCH methods. Exports were regressed against real effective exchange rate, trade openness and capacity utilisation. The research aimed to establish whether exchange rate volatility impacts negatively on export performance in the manner suggested by the econometric model. The result obtained showed that exchange rate volatility had a significantly negative effect on South African exports in the period 2000-2011.
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The impact of financial development on private investment in south Africa
- Authors: Mukuya, Prisca R
- Date: 2014
- Subjects: Economic development -- South Africa , Gross domestic product -- South Africa , Investments, Foreign -- South Africa
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11488 , http://hdl.handle.net/10353/d1018210 , Economic development -- South Africa , Gross domestic product -- South Africa , Investments, Foreign -- South Africa
- Description: Empirical evidence and theoretical propositions suggest that financial development is strongly correlated to private investment because financial development positively affects investments by affecting capital accumulation, altering savings rate or by channelizing savings to various capital producing technologies. This study empirically investigated the impact of financial development on private investment in South Africa using quarterly data for the period 1994/01 to 2011/04. This study assess whether the theoretical and empirical propositions can be supported in South Africa. Cointegration tests using the Johansen approach (1988) were conducted to examine if there is a stable relationship in the level of private investment and financial development in South Africa. As a proxy for financial sector development, credit to private sector as per cent of GDP and stock market development were employed. Other variables that affect investment such as real interest rates and real GDP were also included in the model. Results of the study indicate that stock market development and real GDP have a positive relationship with private investment. Bank credit to the private sector however showed a negative relationship with private investment. A negative relationship was also noted for the relationship between private investment and real interest rates.
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The impact of foreign debt on economic growth in South Africa
- Authors: Shayanewako, V B
- Date: 2013
- Subjects: Debts, External -- South Africa -- Eastern Cape , Investments, Foreign -- South Africa , Government spending policy -- South Africa , Economic development -- South Africa
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11477 , http://hdl.handle.net/10353/d1015140 , Debts, External -- South Africa -- Eastern Cape , Investments, Foreign -- South Africa , Government spending policy -- South Africa , Economic development -- South Africa
- Description: This study analyses the economic impact between foreign debt and economic growth in South Africa. By fitting a production function model to annual data for the period 1980-2011, the study examines the dynamic effect of debt service, capital stock and labour force on the economic growth of the country. By following Cunningham (1993), it has identified the long-run and short-run causal relationships among the included variables. The results indicate that the debt servicing burden has a negative effect on the productivity of labour and capital, and thereby affect economic growth adversely. The results also illustrate that the debt service ratio tends to negatively affect GDP and the rate of economic growth in the long-run, which, in turn, reduces the ability of the country to service its debt. Similarly, the estimated error correction term shows the existence of a significant long-run causal relationship among the specified variables. Overall, the results suggest the existence of short-run and long-run causal relationships running from debt service to GDP.
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The impact of stock market development on economic growth: evidence from South Africa
- Authors: Vacu, Nomfundo Portia
- Date: 2013
- Subjects: Stock exchanges -- South Africa , Economic development -- South Africa , Stocks -- Economic aspects -- South Africa , South Africa -- Economic conditions , Stock market development , Economic growth , South Africa
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11655 , http://hdl.handle.net/10353/d1006983 , Stock exchanges -- South Africa , Economic development -- South Africa , Stocks -- Economic aspects -- South Africa , South Africa -- Economic conditions , Stock market development , Economic growth , South Africa
- Description: The main objective of this study is to examine the long run relationship between stock market development and economic growth in the case of South Africa. The study used quarterly data covering the period from 1990Q1 to 2010Q4. To empirically test the link between the two variables, the study used the Johnson’s cointegration approach and Granger causality so as to test the direction of the relationship. The Vector Error Correction Model was also employed to capture both short run and long run dynamics. Generally, the results reveal that a long run relationship exists between the two variables and the causality flows from economic growth to stock market development. Also, the extent to which of stock market development impacts on growth is statistically weak.
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Financial liberalisation and economic growth in South Africa
- Authors: Sibanda, Hlanganani Siqondile.
- Date: 2012
- Subjects: Economic development -- South Africa , Monetary policy -- South Africa , Finance -- Management , Capital movements -- South Africa , Free trade -- South Africa , Expenditures, Public
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11471 , http://hdl.handle.net/10353/d1007131 , Economic development -- South Africa , Monetary policy -- South Africa , Finance -- Management , Capital movements -- South Africa , Free trade -- South Africa , Expenditures, Public
- Description: This study examined the impact of financial liberalisation on economic growth in South Africa. The study used quarterly time series data for the period 1980 to 2010. A vector error correction model was used to determine the short run and long run effects of financial liberalisation on economic growth in South Africa. The other explanatory variables considered in this study were government expenditure, investment ratio, public expenditure on education and trade openness. Results from this study revealed that financial liberalisation, government expenditure and public expenditure on education have a positive impact on economic growth while trade openness negatively affects economic growth in South Africa. Policy recommendations were made using these results.
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The effect of foreign direct investment on economic growth: evidence from South Africa
- Authors: Mazenda, Adrino
- Date: 2012
- Subjects: International Monetary Fund , Investments, Foreign -- South Africa , Economic development -- South Africa , International finance , Finance -- Developing countries
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11462 , http://hdl.handle.net/10353/d1007027 , International Monetary Fund , Investments, Foreign -- South Africa , Economic development -- South Africa , International finance , Finance -- Developing countries
- Description: Foreign direct investment amongst other mechanisms provides capital inflow meant to stimulate economic growth. Apart from promoting economic growth, FDI can also lead to increase in employment, technology, technical knowhow and managerial skills. South Africa has implemented various policy initiatives in attempts to attract foreign investment. This study investigates on the effect of foreign direct investment on economic growth, with particular reference to the South African economy. The period of study is from 1980 to 2010. The study begins by reviewing literature on economic growth and foreign direct investment. South Africa’s macroeconomic background is examined to determine the trends in FDI inflows and economic growth. An empirical model linking theoretical and empirical literature on the effect of FDI on economic growth is estimated using the Johansen cointegration and VECM framework. Variables specified in the methodology include real gross domestic product (RGDP), foreign direct investment (FDI), domestic investment (INVE), real exchange rate (REXCH) and foreign marketable debt (DEBT). The long run results showed that FDI, REXCH and DEBT have a negative impact on growth. INVE has a positive impact on growth. Short run results indicated that there is no strong pressure on RGDP to restore long-run equilibrium whenever there is a disturbance. The short run lag of FDI was found to exert a positive impact on growth. The impulse response and variance decomposition analysis complemented the long and short-run findings. Shocks on REXCH, and DEBT generated a negative response on RGDP. The shocks were not significantly different from zero and were transitory. Results from the variance decomposition analysis revealed that the fundamentals explain some, but not all, of the variations of RGDP. For the fifth year forecast error variance RGDP explains the largest component of the variation followed by INVE, REXCH, FDI and DEBT. After a period of ten years, the influence of RGDP and INVE declines, whereas REXCH, FDI and DEBT increase. Conclusions and policy recommendations were made using these results.
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The impact of capital flows on real exchange rates in South Africa
- Authors: Mishi, Syden
- Date: 2012
- Subjects: Capital movements -- South Africa , Economic development -- South Africa , Foreign exchange -- South Africa , Interest rates -- South Africa , Currency question -- South Africa , Saving and investment -- South Africa , Free trade -- South Africa , Anti-inflationary policies -- South Africa , Cointegration -- South Africa
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11466 , http://hdl.handle.net/10353/d1007089 , Capital movements -- South Africa , Economic development -- South Africa , Foreign exchange -- South Africa , Interest rates -- South Africa , Currency question -- South Africa , Saving and investment -- South Africa , Free trade -- South Africa , Anti-inflationary policies -- South Africa , Cointegration -- South Africa
- Description: The neoclassical theory suggests that free flows of external capital should be equilibrating and thereby facilitating smoothening of an economy's consumption or production patterns. South Africa has a very low savings rate, making it highly dependent on capital inflows which create instability and volatility in global markets. A policy dilemma is undoubtedly evident: capital inflows help to cater for the domestic low savings and at the same time the inflows pose instability, a threat on competitiveness and volatility challenges to the same economy due to their impact on exchange rates. The question is: are all forms of capital flows equally destabilizing? Since studies based on South Africa considered only the relationship between aggregate capital flows and real exchange rate, modelling individual components of capital flows could enlighten policy formulation even further. The composition of the flows and their effects on the composition of aggregate demand determine the evolution of real exchange rate response to surges in capital flows. Through co-integration and vector error correction modelling techniques applied to South African data between 1990 and 2010, the study found out that foreign portfolio investment exerts the greatest appreciation effect on the South African real exchange rate, followed by other investment and finally foreign direct investment. Thus the impact of capital flows on real exchange rate in South Africa differs by type of capital. This presents varied policy implications.
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The impact of private capital flows on economic growth in South Africa
- Authors: Dzangare, Gillian
- Date: 2012
- Subjects: Economic development -- South Africa , Capital movements -- South Africa , Investments, Foreign -- South Africa , Development economics -- South Africa , Interest rates -- South Africa , Free trade -- South Africa , Cointegration -- South Africa , South Africa -- Commercial policy
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11472 , http://hdl.handle.net/10353/d1007134 , Economic development -- South Africa , Capital movements -- South Africa , Investments, Foreign -- South Africa , Development economics -- South Africa , Interest rates -- South Africa , Free trade -- South Africa , Cointegration -- South Africa , South Africa -- Commercial policy
- Description: In this study an analysis of the long-term equilibrium relationship between economic growth measured as real GDP growth and private capital inflows is explored. The link between private capital inflows and economic growth is well-documented in the literature. However, a void in the literature relates to examining the cointegrating relationship between private capital inflows and economic growth particularly for South Africa. It is widely claimed that private capital inflows foster economic growth by closing the savings/investment gap. However, clarity on this point is necessary because of the seemingly unclear nature of the relationship in the literature. The exact form of this relationship as well as the nature of capital flows that could impact on real growth requires further investigation. Moreover, what exactly happens to this relationship in an economic crisis such as recently recorded in the global financial crisis is not clear. The analysis is undertaken by employing cointegration and vector error correction modeling approach using quarterly data for the period 1989q4-2009q4. This study employs the Johansen (1998) cointegration test. This technique distinguishes itself since it establishes the long run relationship between variables. Thereafter, residual diagnostic checks are performed on the variables. Our results show among others, that private capital inflows have impacted positively on the growth of the South African economy. The areas for further research that emerge from this study include the effect of some government policies on economic growth that should also receive more attention in the future since political instability slows down investment.
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The impact of real exchange rates on economic growth: a case study of South Africa
- Authors: Sibanda, Kin
- Date: 2012
- Subjects: Economic development -- South Africa , Foreign exchange -- South Africa , Interest rates -- South Africa , Money supply -- South Africa , Free trade -- South Africa , Saving and investment -- South Africa , Devaluation of currency -- South Africa , Currency question -- South Africa , South Africa -- Economic policy
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11469 , http://hdl.handle.net/10353/d1007129 , Economic development -- South Africa , Foreign exchange -- South Africa , Interest rates -- South Africa , Money supply -- South Africa , Free trade -- South Africa , Saving and investment -- South Africa , Devaluation of currency -- South Africa , Currency question -- South Africa , South Africa -- Economic policy
- Description: This study examined the impact of real exchange rates on economic growth in South Africa. The study used quarterly time series data for the period of 1994 to 2010. The Johansen cointegration and vector error correction model was used to determine the impact of real exchange on economic growth in South Africa. The explanatory variables in this study were real exchange rates, real interest rates, money supply, trade openness and gross fixed capital formation. Results from this study revealed that real exchange rates, gross fixed capital formation and real interest rates have a positive long run impact on economic growth, while money supply and trade openness have a negative long run impact on economic growth in South Africa. From the regression results, it was noted that undervaluation of the currency significantly hampers growth in the long run, whilst it significantly enhances economic growth in the short run. As such, the policy of depreciating the exchange rates to achieve higher growth rates is only effective in the short run and is not sustainable in the long run. Based on the findings of this study, the researcher recommended that misalignment (overvaluation and undervaluation) of the currency should be avoided at all costs. In addition, the results of the study showed that interest rates also have a significant impact on growth and since interest rates have a bearing on the exchange rate, it was recommended that the current monetary policy in South Africa should be maintained.
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The role of export diversification on economic growth in South Africa: 1980 - 2010
- Authors: Mudenda, Caroline
- Date: 2012
- Subjects: Economic development -- South Africa , International trade , Exports -- South Africa , Capital movements -- South Africa , Human capital -- South Africa , Free trade -- South Africa , Foreign exchange -- South Africa , South Africa -- Economic conditions
- Language: English
- Type: Thesis , Masters , M Com
- Identifier: vital:11463 , http://hdl.handle.net/10353/d1007044 , Economic development -- South Africa , International trade , Exports -- South Africa , Capital movements -- South Africa , Human capital -- South Africa , Free trade -- South Africa , Foreign exchange -- South Africa , South Africa -- Economic conditions
- Description: This study examined the role of export diversification on economic growth in South Africa. The study used annual time series data for the period covering 1980 to 2010 and employed a Vector Error Correction Model to determine the effects of export diversification and possible factors that affect it on economic growth. Possible factors that affect export diversification considered as independent variables in this study include gross capital formation, human capital, real effective exchange rate and trade openness. Results of the study reveal that export diversification and trade openness are positively related to economic growth while real effective exchange rate, capital formation and human capital have negative long run relationships with economic growth. The study recommended the continual implementation of trade liberalisation by the South African government. The South African government is also encouraged to promote the production of a diversified export basket through subsidisation, promotion of innovation and production of new products.
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An assessment of local economic development as a mechanism for poverty alleviation: a case study of selected municipalities in Amathole District
- Authors: Dube, Kethiwe
- Date: 2011-06
- Subjects: Economic development -- South Africa , Poverty -- South Africa
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10353/24410 , vital:62788
- Description: The legacy of apartheid created uneven development in South Africa, which led to lack of effective service delivery, high levels of poverty and unemployment. This resulted in many people within the communities being vulnerable to poverty. In response to the retarded development, the post apartheid government formulated a number of policies and legislations. Local Economic Development (LED) is one of the policies mandated to guide developmental local government initiatives in addressing poverty, unemployment and redistribution. The aim of the study was to assess LED as a mechanism for poverty alleviation, focusing on the effectiveness of the LED strategies employed by the selected municipalities in Amathole District Municipality (ADM). The literature and the empirical study revealed that LED is seen as a tool through which socio-economic development can be achieved. To achieve the objectives of the study, the study employed both quantitative and qualitative research methods. A thematic content and pie chat analysis were employed to analyse data, which was gathered using questionnaires, interviews, non-participant observation and documentary survey. The findings of the study revealed that LED strategies have a significant impact on improving infrastructure and service delivery, have both a pro-poor and a pro-growth focus on improving the general welfare of the residents and that LED agencies play a pivotal role in promoting sustainable development, thereby alleviating poverty. Though the current LED strategies employed by ADM are deemed to be effective, they do not fully meet the intended goal of eradicating poverty. Therefore, the researcher recommended that the municipalities should, inter alia, encourage responsible leadership, expand capital investment, promote capacity building and communities should be fully committed in working together with the municipalities in promoting sustainable development. , Thesis (MPA) -- Faculty of Management and Commerce, 2011
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