jrge
Abstract - Possibility of SADC Monetary Union: Testing for Coordination of Fiscal and Monetary Policies
|
|
Abstract: There is consensus that fiscal and monetary policies should be coordinated into a broader macroeconomic framework for sustainable monetary union. The Brexit scenario, and the debt problems of some European Union members has vindicated re-consideration of premises on which monetary unions are set-up. Southern African Development Community (SADC) had mooted the idea of a monetary union, despite the Rand Common Currency Area not being successful. However, there has been little literature on coordination of fiscal and monetary policies within and across SADC countries. The aim of this study is to examine whether the key macroeconomic policies are coordinated in order to create a spring-board for a sustainable monetary union. The study employed panel data analysis techniques on 14 SADC countries. The Pooled Mean Group (PGM) method was applied to constrain the long-run coefficients to be identical, but allow the short-run coefficients and error variance to differ across groups. The application of PGM technique allows the study to control for heterogeneity across countries and the time dependence that exist on most macroeconomic series. The empirical results show that there is fiscal and monetary policies coordination amongst some SADC countries. However, cross-country differences on key macroeconomic fundamentals such debts, fiscal balances and money supply may hinder the formation of a monetary union and obstruct the economic survival initiatives for trade amongst member states. The paper concludes monetary union may naturally become necessary to facilitate cooperation and trade amongst countries once there exists shared goals. Keywords: Macroeconomic policy, policy coordination, International Finance, Economic Development, Monetary Union. |
Abstract - Economic Activities of Mining Production and Agricultural Economic Growth in South Africa
|
|
Abstract: South Africa is experiencing declining mining sector output that is economically detrimental as it leaves large numbers of mining workers unemployed. Unskilled retrenched mine workers from about 5,906 abandoned mines resulted in a discrete jump in the productive wealth of poor South Africans, as trends in mining profits declined. It is precisely this challenge that made economic succession planning in South African mines a potentially attractive policy option in the fight against poverty. This paper provides some of the first well-identified estimates of the viability of how post mining transformation can take place through agricultural production. Therefore, the paper aims to examine the relationship between the mining production economic activities and the agricultural economic growth using South African data. Employing the autoregressive distributive lag approach and impulse response functions, it has been found that the mining production has a significant long run relationship and can positively influence the agricultural economy. This is in line with the views of Rostow (1959) that mining production can be associated with agricultural activities and be used as a tool for post mining transformation. Therefore, it can be recommended that mines can engage to formulate policies that address post mining transformation into agricultural activities to redirect labor skills when the time of closing mines come. Suggested policies range from skill redirection of mine workers to agricultural activities. For instance, plantation of some fibrous plants that can grow well in mining land, and engage in some more economic activities like manufacturing and tourism of those agricultural products. Keywords: Unemployment, post mining transformation, autoregressive distributive lag, agricultural production. |
Abstract - The Implications of Labour Productivity and Labour Costs on the South African Economy
|
|
Abstract: The research has shown that labour productivity growth has been slowing down. This trend is suggesting that the gains in the quality of employment in several regions of the world might be difficult to sustain. Furthermore, the South African workers were found to have the greatest amount of unproductive time and they are said to be having one of the lowest employee productivity stats in the world. The purpose of this study was to investigate the implications of labour productivity and labour costs on the South African economy. The Ordinary Least Square (OLS) based Autoregressive Distributed Lag (ARDL) approach was employed to analyse the quarterly time series data from 1998 to 2018. Since South Africa is faced with several challenges such as high levels of unemployment, higher wage bills and high levels of poverty; this study is envisaged to provide an empirical evidence to policymakers and union leaders alike to begin to recognise more fully the importance of labour productivity and labour costs towards economic growth. The results indicate that labour productivity has a significant positive impact on economic growth however labour costs have a significant negative impact on the economy of South Africa. Policy formulation should focus on policies that can help to improve the quality of the labour force in order to achieve desired economic growth levels that can help to increase the levels of employment and the reduction of poverty. Similarly, both the workers and the labour unions should be cautious not to milk the cash cow until it dies. Keywords: Labour productivity, Manufacturing, Economic growth, Autoregressive Distributed Lag, South Africa. |
Abstract - The Effect of Financial Crises on Growth and FDI in some African Countries: A Panel VECM Approach
|
|
Abstract: This study investigates the effects of financial crises on economic growth and foreign direct investment in some African countries. A panel vector error correction model is used for the analysis of annual time series data for the period 1994 to 2014. From economic growth model, in the long run, it is observed that gross domestic product per capita is positively influenced by investment, trade and foreign direct investment; with investment and trade being statistically significant. Gross domestic product per capita has a negative significant relationship with real effective exchange rate. On the other hand, in the long run, the investment model shows that investment has a significant positive relationship with both gross domestic product per capita and investment; while it has a negative significant relationship with real effective exchange rate and trade. Also observed from the results is that financial crisis has a negative relationship with both economic growth and foreign direct investment. This study recommends more openness of the economy so as to promote both economic growth and inflow of foreign direct investment in countries. It also recommends the need to encourage more gross fixed capital formation in order to promote both economic growth and foreign direct investment. Keywords: Financial Crisis, Foreign Direct Investment, Economic Growth and Panel Vector Error Correction Model. |
