Ideas and power: shaping monetary policy in South Africa 1919-1936
- Authors: Bordiss, Bradley John
- Date: 2014
- Subjects: Monetary policy -- South Africa -- 1919-1936 Economic development -- South Africa -- 1919-1936 Economics -- South Africa -- History Economics -- Philosophy South Africa -- Economic policy -- 1919-1936 South Africa -- Foreign economic relations -- 1919-1936 Great Britain -- Foreign economic relations -- 1919-1936 Great Britain -- Economic policy -- 1918-1945
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1084 , http://hdl.handle.net/10962/d1011605
- Description: In the concluding paragraphs of Keynes’ General Theory, Keynes suggests that vested interests (power) may dominate in the short term, but that “sooner or later, it is ideas, not vested interests, which are dangerous for good or evil” (Keynes; 1936:384). This dissertation seeks to establish whether this is so, and to what extent, in the period 1919 to 1936, insofar as the shaping of monetary policy was concerned. The context that South Africa found itself in at the time was one in which Britain, the colonising power, was in economic decline. Britain’s real economy had lost its lead in the world in the late 1800s, and by our period, 1919 – 1936, she was now struggling to maintain her dominance of the world’s financial economy. South African gold flows to London, and a South African monetary policy supportive of British monetary policy, became more important than ever to Britain. On the back of its ascendant real economy, the United States of America was fast developing its financial sector as a rival to that centered on London. In the broader monetary policy world, the orthodox monetary regime of the Gold Standard, which had worked so well in the period from 1875 to 1914, was firstly difficult to reestablish, and once established, difficult to maintain. Opinion on what should be done was divided between the majority who favoured a return to the orthodoxy, and a much smaller group, including John Maynard Keynes, who argued that the Gold Standard should no longer be the preferred monetary system. In South Africa, our period starts 17 years after the Second Boer War. Afrikaner nationalists intent on establishing independence from Britain, competed with those, including Jan Christiaan Smuts, who believed that tying our policy up with that of the British Empire was the best for South Africa. It is in this context that a naturalised Briton, which the research shows was a loyal servant of the London power elite, was appointed by the Empire-friendly Smuts government to advise the South African government on monetary policy, the setting up of the South African Reserve Bank, the appointment of its first Governor and other matters in the period up until the fall of this government in 1924. It is also in this context that an American ‘Currency Doctor’ and Professor of Economics at Princeton University, which the research shows was intimately connected with the American government and Benjamin Strong at the Federal Reserve, was appointed by the Pact government later in 1924, and who was anxious to throw off the yoke of British control. The theoretical paradigm of this study is that developed by John Maynard Keynes and after him by the post-Keynesian economists, particularly Basil Moore and Hyman P. Minsky. Instead of considering the theory chronologically, book by book, the theory section deals with the subject matter in the themes which came up in the monetary policy debates of the time, looking at all the theoretical literature that applied to these various themes. Aside from the correction of errors of emphasis and errors of fact dealt with in chapter two, chapter five of the dissertation is where most of the original research is reflected. This is the section which deals in depth with the experts that advised the South Africans at the time, how they came to be appointed, whose interests they served, what theories they used in support of their positions, and what was the decision-making process; from their appointment, until their reports were drafted into the law of the Union of South Africa. While Ally’s work (1994) is accepted as the principal work on the influence of the Bank of England, and Britain’s control of South African gold on South African gold and monetary policy, this dissertation claims legitimacy based on a much closer look at the motives and vested interests of the experts advising the South African government at the time. By the end of this chapter, I believe we are better placed to understand and analyse the relative influence of ideas and power on monetary policy in the period 1919 – 1936.
- Full Text:
- Date Issued: 2014
- Authors: Bordiss, Bradley John
- Date: 2014
- Subjects: Monetary policy -- South Africa -- 1919-1936 Economic development -- South Africa -- 1919-1936 Economics -- South Africa -- History Economics -- Philosophy South Africa -- Economic policy -- 1919-1936 South Africa -- Foreign economic relations -- 1919-1936 Great Britain -- Foreign economic relations -- 1919-1936 Great Britain -- Economic policy -- 1918-1945
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1084 , http://hdl.handle.net/10962/d1011605
- Description: In the concluding paragraphs of Keynes’ General Theory, Keynes suggests that vested interests (power) may dominate in the short term, but that “sooner or later, it is ideas, not vested interests, which are dangerous for good or evil” (Keynes; 1936:384). This dissertation seeks to establish whether this is so, and to what extent, in the period 1919 to 1936, insofar as the shaping of monetary policy was concerned. The context that South Africa found itself in at the time was one in which Britain, the colonising power, was in economic decline. Britain’s real economy had lost its lead in the world in the late 1800s, and by our period, 1919 – 1936, she was now struggling to maintain her dominance of the world’s financial economy. South African gold flows to London, and a South African monetary policy supportive of British monetary policy, became more important than ever to Britain. On the back of its ascendant real economy, the United States of America was fast developing its financial sector as a rival to that centered on London. In the broader monetary policy world, the orthodox monetary regime of the Gold Standard, which had worked so well in the period from 1875 to 1914, was firstly difficult to reestablish, and once established, difficult to maintain. Opinion on what should be done was divided between the majority who favoured a return to the orthodoxy, and a much smaller group, including John Maynard Keynes, who argued that the Gold Standard should no longer be the preferred monetary system. In South Africa, our period starts 17 years after the Second Boer War. Afrikaner nationalists intent on establishing independence from Britain, competed with those, including Jan Christiaan Smuts, who believed that tying our policy up with that of the British Empire was the best for South Africa. It is in this context that a naturalised Briton, which the research shows was a loyal servant of the London power elite, was appointed by the Empire-friendly Smuts government to advise the South African government on monetary policy, the setting up of the South African Reserve Bank, the appointment of its first Governor and other matters in the period up until the fall of this government in 1924. It is also in this context that an American ‘Currency Doctor’ and Professor of Economics at Princeton University, which the research shows was intimately connected with the American government and Benjamin Strong at the Federal Reserve, was appointed by the Pact government later in 1924, and who was anxious to throw off the yoke of British control. The theoretical paradigm of this study is that developed by John Maynard Keynes and after him by the post-Keynesian economists, particularly Basil Moore and Hyman P. Minsky. Instead of considering the theory chronologically, book by book, the theory section deals with the subject matter in the themes which came up in the monetary policy debates of the time, looking at all the theoretical literature that applied to these various themes. Aside from the correction of errors of emphasis and errors of fact dealt with in chapter two, chapter five of the dissertation is where most of the original research is reflected. This is the section which deals in depth with the experts that advised the South Africans at the time, how they came to be appointed, whose interests they served, what theories they used in support of their positions, and what was the decision-making process; from their appointment, until their reports were drafted into the law of the Union of South Africa. While Ally’s work (1994) is accepted as the principal work on the influence of the Bank of England, and Britain’s control of South African gold on South African gold and monetary policy, this dissertation claims legitimacy based on a much closer look at the motives and vested interests of the experts advising the South African government at the time. By the end of this chapter, I believe we are better placed to understand and analyse the relative influence of ideas and power on monetary policy in the period 1919 – 1936.
- Full Text:
- Date Issued: 2014
Is economic growth without human development sustainable? : Sub-Saharan Africa’s recent growth acceleration in context
- Authors: Hadisi Basingene, Serge
- Date: 2014
- Subjects: Sustainable development -- Africa, Sub-Saharan , Economic development -- Africa, Sub-Saharan , Poverty -- Africa, Sub-Saharan , Africa, Sub-Saharan -- Social conditions , Africa, Sub-Saharan -- Economic conditions , Africa, Sub-Saharan -- Economic policy
- Language: English
- Type: Thesis , Masters , MEcon
- Identifier: vital:1098 , http://hdl.handle.net/10962/d1013137
- Description: The purpose of the study has been to assess the question of sustainability of economic growth and human development, particularly using sub-Saharan Africa in context. Sub-Saharan Africa is an interesting case study because, on the one hand, it has been mired in poverty and remains the least developed region in the world, and on the other, it has experienced a revival in economic growth since the mid-1990s. Economists tend to use the term economic development and economic growth interchangeably. However, questions have been raised about whether Africa’s latest growth episode is indeed ‘development’. Although there are many issues at stake, the key question, and the focus of this thesis, is whether sub-Saharan Africa’s revival is sustainable. The paper sets out the debate between the ‘World Bank view’ and the ‘alternative view’. The main debate lies around how genuine development should be achieved. Firstly, the ‘World Bank view’ claims that economic growth is necessary and sufficient condition to achieve development. Economic growth will be generated by ‘orthodox’ policies and this growth will automatically trickle-down and stimulate development. Secondly, the ‘alternative view’ argues that economic growth is necessary but it is not sufficient to stimulate sustainable development. Economic growth without ‘qualitative’ change is not ‘sustainable’. Indeed, human development shortfalls (as well as other, social, political and structural problems), if not addressed through appropriate policy interventions, can undermine economic growth. The ‘alternative view’ appears to be strongly supported by evidence from other developing regions such as Latin America and East Asia. The empirical study conducted in this thesis reinforces doubts about ‘sustainability’. Even though there are signs of convergence in some indicators; this is not the case for all indicators. More importantly the gap between sub-Saharan Africa and other developing regions remains very wide. Sub-Saharan Africa’s development path remains uncertain. The intention in this study is not to be conclusive that sub-Saharan Africa cannot achieve sustainable development. Rather the study attempts to identify potential hindrances to sub-Saharan Africa’s development and to provide a solid foundation for further research in the same direction.
- Full Text:
- Date Issued: 2014
- Authors: Hadisi Basingene, Serge
- Date: 2014
- Subjects: Sustainable development -- Africa, Sub-Saharan , Economic development -- Africa, Sub-Saharan , Poverty -- Africa, Sub-Saharan , Africa, Sub-Saharan -- Social conditions , Africa, Sub-Saharan -- Economic conditions , Africa, Sub-Saharan -- Economic policy
- Language: English
- Type: Thesis , Masters , MEcon
- Identifier: vital:1098 , http://hdl.handle.net/10962/d1013137
- Description: The purpose of the study has been to assess the question of sustainability of economic growth and human development, particularly using sub-Saharan Africa in context. Sub-Saharan Africa is an interesting case study because, on the one hand, it has been mired in poverty and remains the least developed region in the world, and on the other, it has experienced a revival in economic growth since the mid-1990s. Economists tend to use the term economic development and economic growth interchangeably. However, questions have been raised about whether Africa’s latest growth episode is indeed ‘development’. Although there are many issues at stake, the key question, and the focus of this thesis, is whether sub-Saharan Africa’s revival is sustainable. The paper sets out the debate between the ‘World Bank view’ and the ‘alternative view’. The main debate lies around how genuine development should be achieved. Firstly, the ‘World Bank view’ claims that economic growth is necessary and sufficient condition to achieve development. Economic growth will be generated by ‘orthodox’ policies and this growth will automatically trickle-down and stimulate development. Secondly, the ‘alternative view’ argues that economic growth is necessary but it is not sufficient to stimulate sustainable development. Economic growth without ‘qualitative’ change is not ‘sustainable’. Indeed, human development shortfalls (as well as other, social, political and structural problems), if not addressed through appropriate policy interventions, can undermine economic growth. The ‘alternative view’ appears to be strongly supported by evidence from other developing regions such as Latin America and East Asia. The empirical study conducted in this thesis reinforces doubts about ‘sustainability’. Even though there are signs of convergence in some indicators; this is not the case for all indicators. More importantly the gap between sub-Saharan Africa and other developing regions remains very wide. Sub-Saharan Africa’s development path remains uncertain. The intention in this study is not to be conclusive that sub-Saharan Africa cannot achieve sustainable development. Rather the study attempts to identify potential hindrances to sub-Saharan Africa’s development and to provide a solid foundation for further research in the same direction.
- Full Text:
- Date Issued: 2014
Platinum share prices and the Marikana tragedy: an event study
- Authors: Sunga, Tapuwa Terence
- Date: 2014
- Subjects: Marikana (Rustenburg, South Africa) , Massacres -- South Africa -- Rustenburg , Stocks -- Prices -- South Africa , Stocks -- Prices -- Mathematical models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1094 , http://hdl.handle.net/10962/d1013002
- Description: An event study is an economic tool of analysis that has begun to gain popularity in recent empirical literature. It is a technique that gives a researcher the opportunity to map out the reaction of a firm's stock to an event, usually making use of daily or monthly data. However, up to this point, event study methodology has generally been applied to more traditional phenomena capable of affecting equity value, such as dividend and macroeconomic policy announcements, and there have only been a few exceptions to this. This study looks at what impact the tragic shootings at Lonmin mine in Marikana on August 16th 2012 had on the share prices of platinum mining firms based in South Africa using event study methodology. It makes use of the technique to investigate how the share prices responded to the tragedy over a number of trading days, including the day of the shootings. To be best of our knowledge, no attempt has been made to analyse the impact on share prices using events of this nature. For the investigation, daily returns data was used for each firm. The abnormal returns and cumulative abnormal returns to each were then calculated and compared with their respective expected returns in order to determine whether investors in the shares of that particular firm reacted positively, negatively or not at all. The evidence found suggests that tragedies of this nature are capable of influencing share prices in the same manner as more traditional economic phenomena. Overall, only one firm was found to have been negatively affected by the shootings in a persistent manner, while the shares of the other firms examined reacted in a manner that was positive overall, but varied according to individual firm characteristics such as size. These finding conformed to our a priori expectations. In addition, the results also confirm the benefits of applying event study methodology to a wide variety of phenomena that fall outside the boundaries usually associated with business.
- Full Text:
- Date Issued: 2014
- Authors: Sunga, Tapuwa Terence
- Date: 2014
- Subjects: Marikana (Rustenburg, South Africa) , Massacres -- South Africa -- Rustenburg , Stocks -- Prices -- South Africa , Stocks -- Prices -- Mathematical models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1094 , http://hdl.handle.net/10962/d1013002
- Description: An event study is an economic tool of analysis that has begun to gain popularity in recent empirical literature. It is a technique that gives a researcher the opportunity to map out the reaction of a firm's stock to an event, usually making use of daily or monthly data. However, up to this point, event study methodology has generally been applied to more traditional phenomena capable of affecting equity value, such as dividend and macroeconomic policy announcements, and there have only been a few exceptions to this. This study looks at what impact the tragic shootings at Lonmin mine in Marikana on August 16th 2012 had on the share prices of platinum mining firms based in South Africa using event study methodology. It makes use of the technique to investigate how the share prices responded to the tragedy over a number of trading days, including the day of the shootings. To be best of our knowledge, no attempt has been made to analyse the impact on share prices using events of this nature. For the investigation, daily returns data was used for each firm. The abnormal returns and cumulative abnormal returns to each were then calculated and compared with their respective expected returns in order to determine whether investors in the shares of that particular firm reacted positively, negatively or not at all. The evidence found suggests that tragedies of this nature are capable of influencing share prices in the same manner as more traditional economic phenomena. Overall, only one firm was found to have been negatively affected by the shootings in a persistent manner, while the shares of the other firms examined reacted in a manner that was positive overall, but varied according to individual firm characteristics such as size. These finding conformed to our a priori expectations. In addition, the results also confirm the benefits of applying event study methodology to a wide variety of phenomena that fall outside the boundaries usually associated with business.
- Full Text:
- Date Issued: 2014
Reviewing the definition of the natural resource curse and analysing its occurence post-1990
- Authors: Mwansa, Mumamba Chitumwa
- Date: 2014
- Subjects: Resource curse , Natural resources -- Management , Economic development , National income
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1100 , http://hdl.handle.net/10962/d1013243
- Description: That countries with high natural resource abundance should experience slower economic growth than those with low resource abundance seems contrary to what would be expected, considering the developmental head-start such resources afford. Yet Sachs and Warner (1997) found that economies with a high share of natural resource exports in national income in 1970 tended to experience slower economic growth in the two decades that followed. This finding, that natural resources are a “curse” rather than a blessing, has become generally accepted. This thesis sought to test whether the conclusion drawn from their data – that higher natural resource abundance leads to slower economic growth – is still correct. It sought to test their findings first by correcting for their use of resource intensity (natural resources share of exports) as a proxy for abundance. Using measures of resource abundance for 1995 as a proxy for abundance in previous decades, it was found that higher resource abundance was not associated with lower economic growth in the 1970s and 1980s. This finding is contrary to that of Sachs and Warner (1997, 2001). Secondly, this thesis tested whether the natural resource curse effect was still present for the period 1995–2010. This was done by observing the effect of both resource abundance and resource intensity on economic growth during 1995–2010. In both cases no resource curse effect was found, for this more recent period. The resource curse had disappeared regardless of whether one uses Sachs and Warner’s (1997, 2001) measure of resource intensity or a measure of resource abundance. Natural resources should therefore no longer be considered a “curse”. In explaining the difference for the impact of resource intensity between the 1970-90 period measured by Sachs and Warner (1997, 2001) and the more recent period 1995-2010 it was found that the Dutch Disease effect has decreased significantly since the 1970s and 1980s. This could partly explain why the resource curse has disappeared when measured in terms of resource intensity. Thus it was concluded that the natural resource curse existed in the period 1970-90 only when measured in terms of resource intensity but not when measured relative to resource abundance. The negative effects of natural resources on economic growth have disappeared in terms of both resource intensity and resource abundance in the more recent time period.
- Full Text:
- Date Issued: 2014
- Authors: Mwansa, Mumamba Chitumwa
- Date: 2014
- Subjects: Resource curse , Natural resources -- Management , Economic development , National income
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1100 , http://hdl.handle.net/10962/d1013243
- Description: That countries with high natural resource abundance should experience slower economic growth than those with low resource abundance seems contrary to what would be expected, considering the developmental head-start such resources afford. Yet Sachs and Warner (1997) found that economies with a high share of natural resource exports in national income in 1970 tended to experience slower economic growth in the two decades that followed. This finding, that natural resources are a “curse” rather than a blessing, has become generally accepted. This thesis sought to test whether the conclusion drawn from their data – that higher natural resource abundance leads to slower economic growth – is still correct. It sought to test their findings first by correcting for their use of resource intensity (natural resources share of exports) as a proxy for abundance. Using measures of resource abundance for 1995 as a proxy for abundance in previous decades, it was found that higher resource abundance was not associated with lower economic growth in the 1970s and 1980s. This finding is contrary to that of Sachs and Warner (1997, 2001). Secondly, this thesis tested whether the natural resource curse effect was still present for the period 1995–2010. This was done by observing the effect of both resource abundance and resource intensity on economic growth during 1995–2010. In both cases no resource curse effect was found, for this more recent period. The resource curse had disappeared regardless of whether one uses Sachs and Warner’s (1997, 2001) measure of resource intensity or a measure of resource abundance. Natural resources should therefore no longer be considered a “curse”. In explaining the difference for the impact of resource intensity between the 1970-90 period measured by Sachs and Warner (1997, 2001) and the more recent period 1995-2010 it was found that the Dutch Disease effect has decreased significantly since the 1970s and 1980s. This could partly explain why the resource curse has disappeared when measured in terms of resource intensity. Thus it was concluded that the natural resource curse existed in the period 1970-90 only when measured in terms of resource intensity but not when measured relative to resource abundance. The negative effects of natural resources on economic growth have disappeared in terms of both resource intensity and resource abundance in the more recent time period.
- Full Text:
- Date Issued: 2014
Saving and investment in South Africa: a causality study
- Authors: Mngqibisa, Vuyisa
- Date: 2014
- Subjects: Saving and investment -- South Africa Investments -- South Africa Credit -- South Africa Finance, Personal -- South Africa Portfolio management -- South Africa Investment analysis -- South Africa Error analysis (Mathematics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1086 , http://hdl.handle.net/10962/d1011887
- Description: This study aims to investigate the relationship between private saving and investment for South Africa using a Vector Error Correction Framework. Saving and investment are considered to be important factors for sustainable economic growth in the country, particularly as these variables have been recorded at significantly lower levels than those of other developing nations. By examining the direction of causality between saving and investment, the most suitable policy measures can be used in stimulating either savings or investment, and as a result aggregate growth. The study found a positive two-way causality to exist between these two variables, proving that both saving and investment-led policies are necessary in raising saving and investment levels. With the inclusion of credit extension as the third variable used to remove any variable bias, the study not only found credit extension to Granger cause private saving, but the reverse relationship was found to be present as well. This relationship was however found to be negative, confirming that lower borrowing constraints may have a negative effect on saving levels. The negative relationship between credit supply and private saving (substitution effect) proves that credit supply will only yield a positive result for savings if channelled through investment expenditure.
- Full Text:
- Date Issued: 2014
- Authors: Mngqibisa, Vuyisa
- Date: 2014
- Subjects: Saving and investment -- South Africa Investments -- South Africa Credit -- South Africa Finance, Personal -- South Africa Portfolio management -- South Africa Investment analysis -- South Africa Error analysis (Mathematics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1086 , http://hdl.handle.net/10962/d1011887
- Description: This study aims to investigate the relationship between private saving and investment for South Africa using a Vector Error Correction Framework. Saving and investment are considered to be important factors for sustainable economic growth in the country, particularly as these variables have been recorded at significantly lower levels than those of other developing nations. By examining the direction of causality between saving and investment, the most suitable policy measures can be used in stimulating either savings or investment, and as a result aggregate growth. The study found a positive two-way causality to exist between these two variables, proving that both saving and investment-led policies are necessary in raising saving and investment levels. With the inclusion of credit extension as the third variable used to remove any variable bias, the study not only found credit extension to Granger cause private saving, but the reverse relationship was found to be present as well. This relationship was however found to be negative, confirming that lower borrowing constraints may have a negative effect on saving levels. The negative relationship between credit supply and private saving (substitution effect) proves that credit supply will only yield a positive result for savings if channelled through investment expenditure.
- Full Text:
- Date Issued: 2014
The developmental state, social policy and social compacts: a comparative policy analysis of the South African case
- Authors: Gwaindepi, Abel
- Date: 2014
- Subjects: Economic development -- Political aspects -- South Africa , Income distribution -- South Africa , Democracy -- South Africa , Industrial policy -- Developing countries , South Africa -- Economic conditions , South Africa -- Social conditions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1101 , http://hdl.handle.net/10962/d1013278
- Description: The history of economic thought is ‘flooded’ with neo-classical accounts despite the fact that neoclassical economics did not occupy history alone. This has caused the discourses on ‘lost alternatives’ to be relegated as the deterministic ‘straight line’ neo-classical historical discourses are elevated. Globally hegemonic neo-classical discourse aided this phenomenon as it served to subordinate any counterhegemonic local discursive processes towards alternatives. This study is premised on the theme of non-neoclassical ‘lost alternatives’ using the post-apartheid South Africa as a case study. Emerging from the apartheid regime, the impetus towards non-neoclassical redistributive policies was strong in South Africa but this did not gain traction as the ANC’s ‘growth through redistribution’ was replaced by globally hegemonic discourse which favoured ‘redistribution through growth’. This thesis postulates the idea of two waves of ‘internal’ discursive formations; capturing the transition to democracy up to 1996 as the first wave and the period from 2005 to about 2009 as the second wave. The developmental state paradigm (DSP) emerged as the central heterodox paradigm with ideas such as industrial policy, welfare, and social dialogue/compacts being main elements. The DSP was expressly chosen in the early 1990s, the first period of strong internal discursive formation, but faded as neo-classical policies, epitomised through GEAR, dominated the policy space. The DSP discourse gained vitality in the second wave of internal discursive formation (2005-2009) and it was associated with the subsequent Zuma’s administration. The study illustrates that the DSP has failed to be fully developed into a practical framework but remained only at rhetorical level with the phrase ‘developmental state’ inserted into government policy documents and documents of ANC as a ruling party. The thesis further illustrates that the DSP fared well ideologically because of its inclination to the ideology of ‘developmentalism’ tended to trump any socialist inclined policies such as a generous welfare regime. The thesis rebuts the notion of the DSP in South Africa which has only been amorphously developed with the phrase ‘developmental state’ becoming a mere buzzword. The thesis argues that the DSP in the 21st century is much more complex and the growing ‘tertiarisation’ of the economy makes the Social Democratic Paradigm SDP’s capability centric approach much more relevant for South Africa. The study goes further to argue that a (SDP) is much more suitable alternative for addressing South African colonial/apartheid legacies and consolidation of democracy.
- Full Text:
- Date Issued: 2014
- Authors: Gwaindepi, Abel
- Date: 2014
- Subjects: Economic development -- Political aspects -- South Africa , Income distribution -- South Africa , Democracy -- South Africa , Industrial policy -- Developing countries , South Africa -- Economic conditions , South Africa -- Social conditions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1101 , http://hdl.handle.net/10962/d1013278
- Description: The history of economic thought is ‘flooded’ with neo-classical accounts despite the fact that neoclassical economics did not occupy history alone. This has caused the discourses on ‘lost alternatives’ to be relegated as the deterministic ‘straight line’ neo-classical historical discourses are elevated. Globally hegemonic neo-classical discourse aided this phenomenon as it served to subordinate any counterhegemonic local discursive processes towards alternatives. This study is premised on the theme of non-neoclassical ‘lost alternatives’ using the post-apartheid South Africa as a case study. Emerging from the apartheid regime, the impetus towards non-neoclassical redistributive policies was strong in South Africa but this did not gain traction as the ANC’s ‘growth through redistribution’ was replaced by globally hegemonic discourse which favoured ‘redistribution through growth’. This thesis postulates the idea of two waves of ‘internal’ discursive formations; capturing the transition to democracy up to 1996 as the first wave and the period from 2005 to about 2009 as the second wave. The developmental state paradigm (DSP) emerged as the central heterodox paradigm with ideas such as industrial policy, welfare, and social dialogue/compacts being main elements. The DSP was expressly chosen in the early 1990s, the first period of strong internal discursive formation, but faded as neo-classical policies, epitomised through GEAR, dominated the policy space. The DSP discourse gained vitality in the second wave of internal discursive formation (2005-2009) and it was associated with the subsequent Zuma’s administration. The study illustrates that the DSP has failed to be fully developed into a practical framework but remained only at rhetorical level with the phrase ‘developmental state’ inserted into government policy documents and documents of ANC as a ruling party. The thesis further illustrates that the DSP fared well ideologically because of its inclination to the ideology of ‘developmentalism’ tended to trump any socialist inclined policies such as a generous welfare regime. The thesis rebuts the notion of the DSP in South Africa which has only been amorphously developed with the phrase ‘developmental state’ becoming a mere buzzword. The thesis argues that the DSP in the 21st century is much more complex and the growing ‘tertiarisation’ of the economy makes the Social Democratic Paradigm SDP’s capability centric approach much more relevant for South Africa. The study goes further to argue that a (SDP) is much more suitable alternative for addressing South African colonial/apartheid legacies and consolidation of democracy.
- Full Text:
- Date Issued: 2014
Why has South Africa been relatively unsuccessful at attracting inward foreign direct investment since 1994?
- Authors: Fulton, Mark Hugh John
- Date: 2014
- Subjects: Investments, Foreign -- South Africa , Investments, Foreign -- Africa, Southern , Investments, Foreign -- Chile , Investments, Foreign -- Botswana , Economic development -- South Africa , Economic development -- Developing countries , Political corruption -- Economic aspects -- South Africa , South Africa -- Economic policy -- 1994-
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1097 , http://hdl.handle.net/10962/d1013056
- Description: Foreign Direct Investment (FDI) flows into South Africa have been very low for several decades, and this research examines the reason(s) why this has been the case since 1994. There is a common belief amongst economists that there is a positive relationship between the amount of FDI received and economic growth, thus the desire to attract greater FDI inflows. A literature review was conducted to establish the determinants of FDI globally and then data were collected and assessed to test which causes are most important. The performance of developing nations in attracting FDI was first compared with that of the developed nations. Thereafter, a regional breakdown of FDI flows was presented, with a particular focus on the Southern African region. FDI inflows to South Africa since 1994 were compared against the identified determinants of FDI, as well as with FDI inflows into two other major mining economies, Chile and Botswana. The friendliness of the government towards business was identified as a significant determinant of FDI inflows and the importance of this factor in explaining FDI inflows into environment in South Africa was looked at in more depth. It was found that many investors perceive the South African government as hostile towards business and as corrupt and/or inefficient. The empirical results show that this negative perception helps explain the FDI inflows attracted by South Africa since 1994. Therefore, increased friendliness to business by the government should increase future inward FDI flows into South Africa.
- Full Text:
- Date Issued: 2014
- Authors: Fulton, Mark Hugh John
- Date: 2014
- Subjects: Investments, Foreign -- South Africa , Investments, Foreign -- Africa, Southern , Investments, Foreign -- Chile , Investments, Foreign -- Botswana , Economic development -- South Africa , Economic development -- Developing countries , Political corruption -- Economic aspects -- South Africa , South Africa -- Economic policy -- 1994-
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1097 , http://hdl.handle.net/10962/d1013056
- Description: Foreign Direct Investment (FDI) flows into South Africa have been very low for several decades, and this research examines the reason(s) why this has been the case since 1994. There is a common belief amongst economists that there is a positive relationship between the amount of FDI received and economic growth, thus the desire to attract greater FDI inflows. A literature review was conducted to establish the determinants of FDI globally and then data were collected and assessed to test which causes are most important. The performance of developing nations in attracting FDI was first compared with that of the developed nations. Thereafter, a regional breakdown of FDI flows was presented, with a particular focus on the Southern African region. FDI inflows to South Africa since 1994 were compared against the identified determinants of FDI, as well as with FDI inflows into two other major mining economies, Chile and Botswana. The friendliness of the government towards business was identified as a significant determinant of FDI inflows and the importance of this factor in explaining FDI inflows into environment in South Africa was looked at in more depth. It was found that many investors perceive the South African government as hostile towards business and as corrupt and/or inefficient. The empirical results show that this negative perception helps explain the FDI inflows attracted by South Africa since 1994. Therefore, increased friendliness to business by the government should increase future inward FDI flows into South Africa.
- Full Text:
- Date Issued: 2014
Willingness to pay for marine-based tourism within the Ponto do Ouro Partial Marine Reserve, Mozambique
- Authors: Daly, Clare Amelie Keating
- Date: 2014
- Subjects: Ponto do Ouro Partial Marine Reserve , Marine ecotourism -- Mozambique , Marine ecotourism -- Economic aspects -- Mozambique , Marine ecotourism -- Mozambique -- Marketing , Ecotourism -- Economic aspects -- Mozambique , Coastal zone management -- Mozambique , Marine resources conservation -- Mozambique
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1102 , http://hdl.handle.net/10962/d1013304
- Description: Marine and coastal ecosystems face widespread degradation largely because market failure hides the economic value of the goods and services provided by them. Marine protected areas (MPAs) can serve as a structure that ensures the continuing function of marine and coastal ecosystem goods and services. Yet, to be effective and sustainable, MPAs must be able to prove their economic worth and generate revenue. User-fees are a common system used to partially finance multi-use MPAs. This study applies contingent valuation as a method of economic valuation within an MPA in southern Mozambique. The objectives of this study are to determine the willingness to pay of combined user groups and of individual user groups for use of the Ponta do Ouro Partial Marine Reserve and to investigate the potential for the reserve to increase revenues for conservation through the implementation of a user-fee for marine based activities. The payment card contingent valuation method was employed to determine willingness to pay of dolphin swim tourists, scuba divers and fishermen. Data was collected by face-to-face interviews of 120 respondents within two popular tourist locations in the PPMR. Results show that visitors within the PPMR are mainly South Africans, loyal to the area. Probit and OLS regressions were used to determine the effects of various independent variables on willingness to pay. Results from the Probit model indicate that African residency, activity and environmental awareness were significant factors that influenced visitors being WTP more than R20 per person per day as a user fee within the PPMR. The OLS model examined independent variables that influenced visitors being willing to pay as well as the impact of the variables on the amount visitors were willing to pay. The OLS model found income, African residency and environmental awareness to be significant factors influencing visitors being willing to pay. The mean WTP was R43.75 per person per day. Using data supplied by the PPMR, conservative estimated annual revenues based on the implementation of this fee amount would range between R1.46m – R 3.3m.
- Full Text:
- Date Issued: 2014
- Authors: Daly, Clare Amelie Keating
- Date: 2014
- Subjects: Ponto do Ouro Partial Marine Reserve , Marine ecotourism -- Mozambique , Marine ecotourism -- Economic aspects -- Mozambique , Marine ecotourism -- Mozambique -- Marketing , Ecotourism -- Economic aspects -- Mozambique , Coastal zone management -- Mozambique , Marine resources conservation -- Mozambique
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1102 , http://hdl.handle.net/10962/d1013304
- Description: Marine and coastal ecosystems face widespread degradation largely because market failure hides the economic value of the goods and services provided by them. Marine protected areas (MPAs) can serve as a structure that ensures the continuing function of marine and coastal ecosystem goods and services. Yet, to be effective and sustainable, MPAs must be able to prove their economic worth and generate revenue. User-fees are a common system used to partially finance multi-use MPAs. This study applies contingent valuation as a method of economic valuation within an MPA in southern Mozambique. The objectives of this study are to determine the willingness to pay of combined user groups and of individual user groups for use of the Ponta do Ouro Partial Marine Reserve and to investigate the potential for the reserve to increase revenues for conservation through the implementation of a user-fee for marine based activities. The payment card contingent valuation method was employed to determine willingness to pay of dolphin swim tourists, scuba divers and fishermen. Data was collected by face-to-face interviews of 120 respondents within two popular tourist locations in the PPMR. Results show that visitors within the PPMR are mainly South Africans, loyal to the area. Probit and OLS regressions were used to determine the effects of various independent variables on willingness to pay. Results from the Probit model indicate that African residency, activity and environmental awareness were significant factors that influenced visitors being WTP more than R20 per person per day as a user fee within the PPMR. The OLS model examined independent variables that influenced visitors being willing to pay as well as the impact of the variables on the amount visitors were willing to pay. The OLS model found income, African residency and environmental awareness to be significant factors influencing visitors being willing to pay. The mean WTP was R43.75 per person per day. Using data supplied by the PPMR, conservative estimated annual revenues based on the implementation of this fee amount would range between R1.46m – R 3.3m.
- Full Text:
- Date Issued: 2014
Modelling daily return variations in developing market currencies
- Authors: Howarth, Grant
- Date: 2013-07-12
- Subjects: Dollar, American , Currency questions , Foreign exchange market , Foreign exchange rates , Rate of return -- Developing countries , Money market , Prices
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1076 , http://hdl.handle.net/10962/d1008365 , Dollar, American , Currency questions , Foreign exchange market , Foreign exchange rates , Rate of return -- Developing countries , Money market , Prices
- Description: This study examines the American Dollar (USD) denominated currency returns of five developing market currencies for the presence of the day-of-the-week effect. Daily data from January 1995 to February 2008 is examined, and is split into two subperiods, SP1 (1995 - 2002) and SP2 (2003 - February 2008). Currency returns are non-normally distributed across the full data set and SP1 , but tend towards normality in SP2. As such non-parametric tests are used to test the equality of the first four moments across days of the week. Tests on the first moment show that two of the currencies do not show any evidence of the day-of-the-week effect. However, evidence of the day-of-the-week effect is found in the other three currencies in SP1, although the effect disappears or weakens significantly in SP2. Little evidence of the day-of-the-week effect is found in tests on the second moment. The hypothesis of equal higher moments across currency returns is rejected for almost all of the weekday pairs for all five currencies in SP1 , but in SP2 the hypothesis of equal higher moments can only be rejected for a single pair of weekdays for one currency. This indicates the disappearance of the day-of-the-week effect across higher moments in SP2. Thus, the study finds that the day-of-the-week effect is present across the first moment and higher moments in the returns to most currencies in SP1 , but has disappeared for all five currencies in SP2. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
- Authors: Howarth, Grant
- Date: 2013-07-12
- Subjects: Dollar, American , Currency questions , Foreign exchange market , Foreign exchange rates , Rate of return -- Developing countries , Money market , Prices
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1076 , http://hdl.handle.net/10962/d1008365 , Dollar, American , Currency questions , Foreign exchange market , Foreign exchange rates , Rate of return -- Developing countries , Money market , Prices
- Description: This study examines the American Dollar (USD) denominated currency returns of five developing market currencies for the presence of the day-of-the-week effect. Daily data from January 1995 to February 2008 is examined, and is split into two subperiods, SP1 (1995 - 2002) and SP2 (2003 - February 2008). Currency returns are non-normally distributed across the full data set and SP1 , but tend towards normality in SP2. As such non-parametric tests are used to test the equality of the first four moments across days of the week. Tests on the first moment show that two of the currencies do not show any evidence of the day-of-the-week effect. However, evidence of the day-of-the-week effect is found in the other three currencies in SP1, although the effect disappears or weakens significantly in SP2. Little evidence of the day-of-the-week effect is found in tests on the second moment. The hypothesis of equal higher moments across currency returns is rejected for almost all of the weekday pairs for all five currencies in SP1 , but in SP2 the hypothesis of equal higher moments can only be rejected for a single pair of weekdays for one currency. This indicates the disappearance of the day-of-the-week effect across higher moments in SP2. Thus, the study finds that the day-of-the-week effect is present across the first moment and higher moments in the returns to most currencies in SP1 , but has disappeared for all five currencies in SP2. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
The functioning of the interbank market and its significance in the transmission of monetary policy
- Authors: De Angelis, Catherine H
- Date: 2013-06-11
- Subjects: South African Reserve Bank , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , Money market -- South Africa , Banks and banking -- South Africa , Repurchase agreements -- South Africa , South Africa -- Economic policy , South Africa -- Economic conditions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1075 , http://hdl.handle.net/10962/d1008054 , South African Reserve Bank , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , Money market -- South Africa , Banks and banking -- South Africa , Repurchase agreements -- South Africa , South Africa -- Economic policy , South Africa -- Economic conditions
- Description: Monetary policy in South African is the primary means by which the authorities can influence activity in the overall economy. The South African Reserve Bank accommodates banks through repo transactions for which they charge the repo rate. The most important market in the transmission of the repo rate to the rest of the economy is the interbank market. As such, a detailed discussion of this market is given. In September 200 I the monetary authorities made certain adjustments to the repo system of accommodation, which included changing the repo rate from a floating rate to a fixed rate that would be administratively determined by the MPC. This was done to address certain weaknesses in the floating rate system. This thesis examines and compares the period before and after the adjustments to the repo system, with the aim of determining whether or not the monetary authorities achieved the goals intended from making this change. The repo rate, prime interbank rate, 3-month NCO rate and the prime lending rate are analysed using the Engle-Granger two variable approach and an ECM model to test for causality. It was found that the monetary authorities did not achieve their intended goals as the relationship between the repo rate and the interbank rate was more significant in the first period. Furthermore, the direction of causality the authorities hoped to achieve by implementing the changes were in fact already in place. As such the adjustments to the system changed the transmission mechanism from the one desired by the authorities to one that was not intended. The conclusions reached by this study show that, in terms of the objectives of the monetary authorities, the previous repo system functioned better. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
- Authors: De Angelis, Catherine H
- Date: 2013-06-11
- Subjects: South African Reserve Bank , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , Money market -- South Africa , Banks and banking -- South Africa , Repurchase agreements -- South Africa , South Africa -- Economic policy , South Africa -- Economic conditions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1075 , http://hdl.handle.net/10962/d1008054 , South African Reserve Bank , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , Money market -- South Africa , Banks and banking -- South Africa , Repurchase agreements -- South Africa , South Africa -- Economic policy , South Africa -- Economic conditions
- Description: Monetary policy in South African is the primary means by which the authorities can influence activity in the overall economy. The South African Reserve Bank accommodates banks through repo transactions for which they charge the repo rate. The most important market in the transmission of the repo rate to the rest of the economy is the interbank market. As such, a detailed discussion of this market is given. In September 200 I the monetary authorities made certain adjustments to the repo system of accommodation, which included changing the repo rate from a floating rate to a fixed rate that would be administratively determined by the MPC. This was done to address certain weaknesses in the floating rate system. This thesis examines and compares the period before and after the adjustments to the repo system, with the aim of determining whether or not the monetary authorities achieved the goals intended from making this change. The repo rate, prime interbank rate, 3-month NCO rate and the prime lending rate are analysed using the Engle-Granger two variable approach and an ECM model to test for causality. It was found that the monetary authorities did not achieve their intended goals as the relationship between the repo rate and the interbank rate was more significant in the first period. Furthermore, the direction of causality the authorities hoped to achieve by implementing the changes were in fact already in place. As such the adjustments to the system changed the transmission mechanism from the one desired by the authorities to one that was not intended. The conclusions reached by this study show that, in terms of the objectives of the monetary authorities, the previous repo system functioned better. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
An analysis of the impact of democratization on debt-led growth : the Nigerian experience, 1970-2000
- Authors: Dinneya, Godson Eze
- Date: 2013-05-22
- Subjects: Debts, External -- Nigeria Nigeria -- Politics and government -- 1960- Nigeria -- Economic policy Nigeria -- Economic conditions -- 1960-
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:1074 , http://hdl.handle.net/10962/d1007807
- Description: The debt-for democracy hypothesis is that undemocratic governments were largely responsible for not only the accumulation but also poor management of externally sourced capital resources. External borrowing had therefore failed to lead to growth of the economies of debtor countries under undemocratic political leadership. Despite this explanation of the debt problem conventional empirical analyses of the debt-growth relationship did not include political institutional variables. This study investigates the relationship between democratization and debt-led growth, using Nigeria, a typical debtor country whose politics was dominated by 'undemocratic ' governance, as a case study. Two broad research questions are investigated namely, whether available data support a negative or positive contribution of debt to the growth of the Nigeria economy during the period 1970-2000; and ifso was there any link between the levels of democratization in Nigeria and debt-led growth. Using a census of major political events in Nigeria around four dimensions of democratization, four primary indices of democratization and one composite index were constructed for the period. Using the Taylor (1983) marginal conditions to gauge the contribution of external debt to the growth of the Nigerian economy, the study found that external debt is capable of playing a double edged sword on the performance of the economy. Positive contributions coincided with the periods when Nigeria's oil dominated foreign exchange revenues were robust, and/ or when debt management strategies were better articulated and vice versa. The analyses of the link between democratization and debt-led growth using both correlation and regression techniques, yielded different results in two definitional contexts of debt-led growth. When defined purely in terms of the Taylor marginal conditions for a positive contribution of debt to the economy of a borrowing nation, the results support the pessimist view that democratization impeded growth. On the contrary, when debt-led growth was defined in a broader sense to incorporate variables such as domestic savings and investment, foreign direct investments, public and private consumption and debt burden, there was strong evidence that debt-led growth performed beller at higher levels of democratization than other wise. The result using the narrow definition was found to be a direct consequence of the overriding influence of export performance in the Taylor conditions. With Nigeria's exports almost entirely dominated by extractive industry the result derived using the narrow definition confirmed the theoretical links between natural resource endowment and regime type on the one hand, and external capital and the nature of the host country 's industry on the other. In the first resource dependence allowed the political leadership to be more detached and less accountable to the electorate since they did not need to levy taxes. Secondly foreign investors concerned with security of their sunk investments in the extractive oil induslly in particular favoured continuity of powerfol regimes with less democratic content. In both findings one thing was common: democratization was associated more with those factors whose decreases affect growth positively than with those whose increases improve growth. The conclusion from this is that the impact of democratization is stronger with negative than with positive growth factors. In other words, while democratization may be supportive of growth its greater impact appears to be in limiting the factors that themselves limit growth. To benefit from the favourable impact of democratisation on debt-led growth therefore the study suggests that improvements in the democratisation process in Nigeria is needed It identifies political education as central to this improvement. A model is developed to show how improvements in the political institutional framework may trickle down, through an enabling environment that is capable of engendering growth-enhancing domestic and international responses to lead in the direction of debt-led growth.
- Full Text:
An analysis of the impact of democratization on debt-led growth : the Nigerian experience, 1970-2000
- Authors: Dinneya, Godson Eze
- Date: 2013-05-22
- Subjects: Debts, External -- Nigeria Nigeria -- Politics and government -- 1960- Nigeria -- Economic policy Nigeria -- Economic conditions -- 1960-
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:1074 , http://hdl.handle.net/10962/d1007807
- Description: The debt-for democracy hypothesis is that undemocratic governments were largely responsible for not only the accumulation but also poor management of externally sourced capital resources. External borrowing had therefore failed to lead to growth of the economies of debtor countries under undemocratic political leadership. Despite this explanation of the debt problem conventional empirical analyses of the debt-growth relationship did not include political institutional variables. This study investigates the relationship between democratization and debt-led growth, using Nigeria, a typical debtor country whose politics was dominated by 'undemocratic ' governance, as a case study. Two broad research questions are investigated namely, whether available data support a negative or positive contribution of debt to the growth of the Nigeria economy during the period 1970-2000; and ifso was there any link between the levels of democratization in Nigeria and debt-led growth. Using a census of major political events in Nigeria around four dimensions of democratization, four primary indices of democratization and one composite index were constructed for the period. Using the Taylor (1983) marginal conditions to gauge the contribution of external debt to the growth of the Nigerian economy, the study found that external debt is capable of playing a double edged sword on the performance of the economy. Positive contributions coincided with the periods when Nigeria's oil dominated foreign exchange revenues were robust, and/ or when debt management strategies were better articulated and vice versa. The analyses of the link between democratization and debt-led growth using both correlation and regression techniques, yielded different results in two definitional contexts of debt-led growth. When defined purely in terms of the Taylor marginal conditions for a positive contribution of debt to the economy of a borrowing nation, the results support the pessimist view that democratization impeded growth. On the contrary, when debt-led growth was defined in a broader sense to incorporate variables such as domestic savings and investment, foreign direct investments, public and private consumption and debt burden, there was strong evidence that debt-led growth performed beller at higher levels of democratization than other wise. The result using the narrow definition was found to be a direct consequence of the overriding influence of export performance in the Taylor conditions. With Nigeria's exports almost entirely dominated by extractive industry the result derived using the narrow definition confirmed the theoretical links between natural resource endowment and regime type on the one hand, and external capital and the nature of the host country 's industry on the other. In the first resource dependence allowed the political leadership to be more detached and less accountable to the electorate since they did not need to levy taxes. Secondly foreign investors concerned with security of their sunk investments in the extractive oil induslly in particular favoured continuity of powerfol regimes with less democratic content. In both findings one thing was common: democratization was associated more with those factors whose decreases affect growth positively than with those whose increases improve growth. The conclusion from this is that the impact of democratization is stronger with negative than with positive growth factors. In other words, while democratization may be supportive of growth its greater impact appears to be in limiting the factors that themselves limit growth. To benefit from the favourable impact of democratisation on debt-led growth therefore the study suggests that improvements in the democratisation process in Nigeria is needed It identifies political education as central to this improvement. A model is developed to show how improvements in the political institutional framework may trickle down, through an enabling environment that is capable of engendering growth-enhancing domestic and international responses to lead in the direction of debt-led growth.
- Full Text:
The economic contribution of the tourism accommodation sector in the Karoo
- Authors: Chandler, Biddy Lee
- Date: 2013-04-06
- Subjects: Hospitality industry South Africa Karoo , Karoo (South Africa) Economic conditions , Small cities South Africa Karoo , Tourism South Africa Karoo
- Language: English
- Type: Academic theses , Master's theses , text
- Identifier: http://hdl.handle.net/10962/366169 , vital:65838
- Description: Tourism is not only the world’s largest traded commodity in which many countries have gained economic advantage and stability, it is also a phenomenon of great economic and social significance. Tourism’s contribution, especially within developing countries and within emerging markets like South Africa, has become increasingly significant as it has created major economic growth and has highlighted areas of potential new sustainable development. The ultimate goal of achieving an increase in GDP and the creation of new employment opportunities is enhanced through the development of tourism. Considering the importance of the above and because the impact of tourism development in small towns is of significant economic benefit, research into this field is of value. This is the core of this study. As a result of tourism demand continually changing in small towns, mostly due to globalisation, demographic changes and agricultural changes, the need to continually update tourism data to ensure that tourism products remain highly rated is vital. This requires identifying tourists’ needs and supplying exactly what tourists demand. More specifically, evaluating tourist satisfaction and dissatisfaction will give accurate indications of a destination’s ability to satisfy its tourists, which is what will encourage repeat visits. The first objective of this dissertation was to qualitatively evaluate, through determining 27 product owners’ and 206 tourists’, opinions/perceptions of the tourism product offering in the Karoo. This study examined the accommodation sector of the tourism industry within 13 small towns in the Karoo. This is a fast growing and maturing industry. The study revealed that product owners and tourists expressed a positive attitude towards the growth of tourism in the Karoo, which they said was due to its heritage and authenticity, climate, desert tourism, natural beauty, ecotourism, remoteness, peace and quiet and acting as a refuge in an unspoilt natural environment. Amongst other recommendations, this result highlighted the importance of keeping closed the ‘gap’ between the expected product/level of service and the customer’s perception of the actual product/service received, by paying special attention to each of the identified tourist benefits. Most importantly, product owners, local tourism organisations (LTOs), municipalities, the government and all tourism stakeholders need to ensure that they work efficiently and effectively through transparent and collaborative relationships to ensure that they generate the highest possible returns from tourism investment through strategies that take cognizance of the above. The second objective of this dissertation was to quantitatively evaluate the economic impact of tourism through gathering and calculating 107 tourists’ spending data and 15 product owners’ expenditure data over a six month period between December 2010 and May 2011 in Graaff-Reinet. It was found that there was an increase over time in tourist spending, which led to an increase in direct income (net injection of visitor spending) and thus there was an increase in indirect income(affecting the level of product owners’ income)in the Graaff-Reinet economy. The key calculations in this study reflected a high multiplier of 1.2and a small amount of leakage (21%);and the final tourism economic impact of the accommodation sector in Graaff-Reinet wasR8940 982.00. This implies a positive economic contribution to this town. A focus on growing the tourist market is therefore a goal worth pursuing. This study provides up-to-date, statistically valid numerical/quantitative data as well as current qualitative data. However, gathering data for a longitudinal study would be highly beneficial to determine trends of how the tourism market in small towns is developing. This field has been given minimal attention, specifically within small towns. This dissertation was thus an attempt to initiate and motivate further ongoing efforts with regards to gathering, specifically economic, tourism data. Showing the positive economic contribution, and the multiple ripple effects that attracting tourists to an area can have, and the ultimate measurable economic benefit created through having a strong multiplier effect, will hopefully encourage all stakeholders to be confident and take the tourism industry more seriously. This highlights the need to recognise the economic impact potential of the tourism sector and to use the positive results identified in this study as a tool to lobby for tourism investment, which is unfortunately not reflected currently in many governmental programmes. Developing greater co-operation and co-ordination between the private and public sectors is needed: the most appropriate development model for the tourism industry being government led, private sector driven, community based and labour conscious in order for it to reap the benefits reflected in this tourism study. , Thesis (MEcon) -- Faculty of Commerce, Economics and Economic History, 2013
- Full Text:
- Date Issued: 2013-04-06
- Authors: Chandler, Biddy Lee
- Date: 2013-04-06
- Subjects: Hospitality industry South Africa Karoo , Karoo (South Africa) Economic conditions , Small cities South Africa Karoo , Tourism South Africa Karoo
- Language: English
- Type: Academic theses , Master's theses , text
- Identifier: http://hdl.handle.net/10962/366169 , vital:65838
- Description: Tourism is not only the world’s largest traded commodity in which many countries have gained economic advantage and stability, it is also a phenomenon of great economic and social significance. Tourism’s contribution, especially within developing countries and within emerging markets like South Africa, has become increasingly significant as it has created major economic growth and has highlighted areas of potential new sustainable development. The ultimate goal of achieving an increase in GDP and the creation of new employment opportunities is enhanced through the development of tourism. Considering the importance of the above and because the impact of tourism development in small towns is of significant economic benefit, research into this field is of value. This is the core of this study. As a result of tourism demand continually changing in small towns, mostly due to globalisation, demographic changes and agricultural changes, the need to continually update tourism data to ensure that tourism products remain highly rated is vital. This requires identifying tourists’ needs and supplying exactly what tourists demand. More specifically, evaluating tourist satisfaction and dissatisfaction will give accurate indications of a destination’s ability to satisfy its tourists, which is what will encourage repeat visits. The first objective of this dissertation was to qualitatively evaluate, through determining 27 product owners’ and 206 tourists’, opinions/perceptions of the tourism product offering in the Karoo. This study examined the accommodation sector of the tourism industry within 13 small towns in the Karoo. This is a fast growing and maturing industry. The study revealed that product owners and tourists expressed a positive attitude towards the growth of tourism in the Karoo, which they said was due to its heritage and authenticity, climate, desert tourism, natural beauty, ecotourism, remoteness, peace and quiet and acting as a refuge in an unspoilt natural environment. Amongst other recommendations, this result highlighted the importance of keeping closed the ‘gap’ between the expected product/level of service and the customer’s perception of the actual product/service received, by paying special attention to each of the identified tourist benefits. Most importantly, product owners, local tourism organisations (LTOs), municipalities, the government and all tourism stakeholders need to ensure that they work efficiently and effectively through transparent and collaborative relationships to ensure that they generate the highest possible returns from tourism investment through strategies that take cognizance of the above. The second objective of this dissertation was to quantitatively evaluate the economic impact of tourism through gathering and calculating 107 tourists’ spending data and 15 product owners’ expenditure data over a six month period between December 2010 and May 2011 in Graaff-Reinet. It was found that there was an increase over time in tourist spending, which led to an increase in direct income (net injection of visitor spending) and thus there was an increase in indirect income(affecting the level of product owners’ income)in the Graaff-Reinet economy. The key calculations in this study reflected a high multiplier of 1.2and a small amount of leakage (21%);and the final tourism economic impact of the accommodation sector in Graaff-Reinet wasR8940 982.00. This implies a positive economic contribution to this town. A focus on growing the tourist market is therefore a goal worth pursuing. This study provides up-to-date, statistically valid numerical/quantitative data as well as current qualitative data. However, gathering data for a longitudinal study would be highly beneficial to determine trends of how the tourism market in small towns is developing. This field has been given minimal attention, specifically within small towns. This dissertation was thus an attempt to initiate and motivate further ongoing efforts with regards to gathering, specifically economic, tourism data. Showing the positive economic contribution, and the multiple ripple effects that attracting tourists to an area can have, and the ultimate measurable economic benefit created through having a strong multiplier effect, will hopefully encourage all stakeholders to be confident and take the tourism industry more seriously. This highlights the need to recognise the economic impact potential of the tourism sector and to use the positive results identified in this study as a tool to lobby for tourism investment, which is unfortunately not reflected currently in many governmental programmes. Developing greater co-operation and co-ordination between the private and public sectors is needed: the most appropriate development model for the tourism industry being government led, private sector driven, community based and labour conscious in order for it to reap the benefits reflected in this tourism study. , Thesis (MEcon) -- Faculty of Commerce, Economics and Economic History, 2013
- Full Text:
- Date Issued: 2013-04-06
A study of maximum and minimum operators with applications to piecewise linear payoff functions
- Authors: Seedat, Ebrahim
- Date: 2013
- Subjects: Options (Finance) Piecewise linear topology Geometry, Affine Riesz spaces Lattice theory Algebra, Boolean Pricing , Max and min operators
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:931 , http://hdl.handle.net/10962/d1001457
- Description: The payoff functions of contingent claims (options) of one variable are prominent in Financial Economics and thus assume a fundamental role in option pricing theory. Some of these payoff functions are continuous, piecewise-defined and linear or affine. Such option payoff functions can be analysed in a useful way when they are represented in additive, Boolean normal, graphical and linear form. The issue of converting such payoff functions expressed in the additive, linear or graphical form into an equivalent Boolean normal form, has been considered by several authors for more than half-a-century to better-understand the role of such functions. One aspect of our study is to unify the foregoing different forms of representation, by creating algorithms that convert a payoff function expressed in graphical form into Boolean normal form and then into the additive form and vice versa. Applications of these algorithms are considered in a general theoretical sense and also in the context of specific option contracts wherever relevant. The use of these algorithms have yielded easy computation of the area enclosed by the graph of various functions using min and max operators in several ways, which, in our opinion, are important in option pricing. To summarise, this study effectively dealt with maximum and minimum operators from several perspectives
- Full Text:
- Date Issued: 2013
- Authors: Seedat, Ebrahim
- Date: 2013
- Subjects: Options (Finance) Piecewise linear topology Geometry, Affine Riesz spaces Lattice theory Algebra, Boolean Pricing , Max and min operators
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:931 , http://hdl.handle.net/10962/d1001457
- Description: The payoff functions of contingent claims (options) of one variable are prominent in Financial Economics and thus assume a fundamental role in option pricing theory. Some of these payoff functions are continuous, piecewise-defined and linear or affine. Such option payoff functions can be analysed in a useful way when they are represented in additive, Boolean normal, graphical and linear form. The issue of converting such payoff functions expressed in the additive, linear or graphical form into an equivalent Boolean normal form, has been considered by several authors for more than half-a-century to better-understand the role of such functions. One aspect of our study is to unify the foregoing different forms of representation, by creating algorithms that convert a payoff function expressed in graphical form into Boolean normal form and then into the additive form and vice versa. Applications of these algorithms are considered in a general theoretical sense and also in the context of specific option contracts wherever relevant. The use of these algorithms have yielded easy computation of the area enclosed by the graph of various functions using min and max operators in several ways, which, in our opinion, are important in option pricing. To summarise, this study effectively dealt with maximum and minimum operators from several perspectives
- Full Text:
- Date Issued: 2013
China's African FDI safari : opportunistic exploitation or muturally beneficial to all participants
- Dreier, Tina, Rhodes University
- Authors: Dreier, Tina , Rhodes University
- Date: 2013 , 2013-04-10
- Subjects: Africa -- Foreign economic relations -- China , China -- Foreign economic relations -- Africa , Investments, Foreign -- China , Foreign direct investment
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:929 , http://hdl.handle.net/10962/d1001455 , Africa -- Foreign economic relations -- China , China -- Foreign economic relations -- Africa , Investments, Foreign -- China
- Description: When implemented within a favourable legislative framework, Foreign Direct Investment (FDI) can produce domestic growth-enhancing spillovers in host countries. Other potential positive effects include the provision of investment capital, the creation of local employment and the transfer of sophisticated technology or advanced knowledge. African nations in particular have been historically reliant on externally-provided funds. Prevailing low income levels, marginal savings rates and the absence of functioning financial markets necessary to provide local start-up capital continue to keep Africa reliant on foreign inflows. Considering China’s increasing financial commitments to Sub- Saharan Africa (SSA) over the last decade, this study examines the state of current Sino-African investment relationships. Specific attention is paid to the outcomes of this strategic bilateral alliance in order to determine whether or not a mutually beneficial investment relationship has evolved. The distinct nature and structure of, the motivation behind and the most significant determinants of Chinese FDI to SSA are all analysed in accordance with traditional FDI theories. A case study approach is used to establish whether China’s contemporary interest in SSA differs from historical investments and to also investigate country-specific commonalities and differences. Of particular relevance to SSA are resource-backed Chinese loans that finance major infrastructure projects in host nations. Interestingly, a lot of the Sino-African investment packages resemble similar deals struck between China and Japan in the 1970s. The results of this study indicate that China’s investment motives seem more diverse than initially expected. Resource-seeking, profit-seeking and market access-seeking reasons appear to be the most important motives. After establishing the Top- Ten recipients of Chinese FDI in SSA, these nations are then classified into three major categories: resource-, oil- or agricultural-rich nations. Undiversified resource- or oil-rich economies are found to have secured the largest shares of Chinese FDI. This study suggests that China’s contemporary “African Safari” is an unconventional way of providing financial assistance. Rather than solely supplying FDI, China finances a diverse mix of instruments, the most important being concessional loans, export credits, zero-interest loans and the establishment of Special Economic Zones. A profound difference to traditional Western investment packages is China’s non-interference approach. Accordingly, Beijing not only refrains from intervening in host countries’ domestic affairs but also refuses to attach formal conditionalties to its loans. China’s “financial safari” into Africa has produced many positive as well as negative effects in host countries. Nevertheless, it would seem that the positive effects outweigh the negative and China’s FDI could contribute to sustainable development in SSA
- Full Text:
- Date Issued: 2013
- Authors: Dreier, Tina , Rhodes University
- Date: 2013 , 2013-04-10
- Subjects: Africa -- Foreign economic relations -- China , China -- Foreign economic relations -- Africa , Investments, Foreign -- China , Foreign direct investment
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:929 , http://hdl.handle.net/10962/d1001455 , Africa -- Foreign economic relations -- China , China -- Foreign economic relations -- Africa , Investments, Foreign -- China
- Description: When implemented within a favourable legislative framework, Foreign Direct Investment (FDI) can produce domestic growth-enhancing spillovers in host countries. Other potential positive effects include the provision of investment capital, the creation of local employment and the transfer of sophisticated technology or advanced knowledge. African nations in particular have been historically reliant on externally-provided funds. Prevailing low income levels, marginal savings rates and the absence of functioning financial markets necessary to provide local start-up capital continue to keep Africa reliant on foreign inflows. Considering China’s increasing financial commitments to Sub- Saharan Africa (SSA) over the last decade, this study examines the state of current Sino-African investment relationships. Specific attention is paid to the outcomes of this strategic bilateral alliance in order to determine whether or not a mutually beneficial investment relationship has evolved. The distinct nature and structure of, the motivation behind and the most significant determinants of Chinese FDI to SSA are all analysed in accordance with traditional FDI theories. A case study approach is used to establish whether China’s contemporary interest in SSA differs from historical investments and to also investigate country-specific commonalities and differences. Of particular relevance to SSA are resource-backed Chinese loans that finance major infrastructure projects in host nations. Interestingly, a lot of the Sino-African investment packages resemble similar deals struck between China and Japan in the 1970s. The results of this study indicate that China’s investment motives seem more diverse than initially expected. Resource-seeking, profit-seeking and market access-seeking reasons appear to be the most important motives. After establishing the Top- Ten recipients of Chinese FDI in SSA, these nations are then classified into three major categories: resource-, oil- or agricultural-rich nations. Undiversified resource- or oil-rich economies are found to have secured the largest shares of Chinese FDI. This study suggests that China’s contemporary “African Safari” is an unconventional way of providing financial assistance. Rather than solely supplying FDI, China finances a diverse mix of instruments, the most important being concessional loans, export credits, zero-interest loans and the establishment of Special Economic Zones. A profound difference to traditional Western investment packages is China’s non-interference approach. Accordingly, Beijing not only refrains from intervening in host countries’ domestic affairs but also refuses to attach formal conditionalties to its loans. China’s “financial safari” into Africa has produced many positive as well as negative effects in host countries. Nevertheless, it would seem that the positive effects outweigh the negative and China’s FDI could contribute to sustainable development in SSA
- Full Text:
- Date Issued: 2013
Modelling stock return volatility dynamics in selected African markets
- Authors: King, Daniel Jonathan
- Date: 2013
- Subjects: Rate of return -- Africa Stocks -- Prices -- Africa Finance -- Developing countries -- Econometric models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1051 , http://hdl.handle.net/10962/d1006452
- Description: Stock return volatility has been shown to occasionally exhibit discrete structural shifts. These shifts are particularly evident in the transition from ‘normal’ to crisis periods, and tend to be more pronounced in developing markets. This study aims to establish whether accounting for structural changes in the conditional variance process, through the use of Markov-switching models, improves estimates and forecasts of stock return volatility over those of the more conventional single-state (G)ARCH models, within and across selected African markets for the period 2002-2012. In the univariate portion of the study, the performances of various Markov-switching models are tested against a single-state benchmark model through the use of in-sample goodness-of-fit and predictive ability measures. In the multivariate context, the single-state and Markov-switching models are comparatively assessed according to their usefulness in constructing optimal stock portfolios. It is found that, even after accounting for structural breaks in the conditional variance process, conventional GARCH effects remain important to capturing the heteroscedasticity evident in the data. However, those univariate models which include a GARCH term are shown to perform comparatively poorly when used for forecasting purposes. Additionally, in the multivariate study, the use of Markov-switching variance-covariance estimates improves risk-adjusted portfolio returns when compared to portfolios that are constructed using the more conventional single-state models. While there is evidence that the use of some Markov-switching models can result in better forecasts and higher risk-adjusted returns than those models which include GARCH effects, the inability of the simpler Markov-switching models to fully capture the heteroscedasticity in the data remains problematic.
- Full Text:
- Date Issued: 2013
- Authors: King, Daniel Jonathan
- Date: 2013
- Subjects: Rate of return -- Africa Stocks -- Prices -- Africa Finance -- Developing countries -- Econometric models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1051 , http://hdl.handle.net/10962/d1006452
- Description: Stock return volatility has been shown to occasionally exhibit discrete structural shifts. These shifts are particularly evident in the transition from ‘normal’ to crisis periods, and tend to be more pronounced in developing markets. This study aims to establish whether accounting for structural changes in the conditional variance process, through the use of Markov-switching models, improves estimates and forecasts of stock return volatility over those of the more conventional single-state (G)ARCH models, within and across selected African markets for the period 2002-2012. In the univariate portion of the study, the performances of various Markov-switching models are tested against a single-state benchmark model through the use of in-sample goodness-of-fit and predictive ability measures. In the multivariate context, the single-state and Markov-switching models are comparatively assessed according to their usefulness in constructing optimal stock portfolios. It is found that, even after accounting for structural breaks in the conditional variance process, conventional GARCH effects remain important to capturing the heteroscedasticity evident in the data. However, those univariate models which include a GARCH term are shown to perform comparatively poorly when used for forecasting purposes. Additionally, in the multivariate study, the use of Markov-switching variance-covariance estimates improves risk-adjusted portfolio returns when compared to portfolios that are constructed using the more conventional single-state models. While there is evidence that the use of some Markov-switching models can result in better forecasts and higher risk-adjusted returns than those models which include GARCH effects, the inability of the simpler Markov-switching models to fully capture the heteroscedasticity in the data remains problematic.
- Full Text:
- Date Issued: 2013
Money supply endogeneity : an empirical investigation of South African data (2000Q1-2011Q4)
- Authors: Schady, Stuart William
- Date: 2013 , 2013-04-29
- Subjects: Monetary policy -- South Africa , Inflation targeting -- South Africa , Gross domestic product -- South Africa , Bank loans -- South Africa , Money supply -- South Africa , Endogenous growth (Economics) , Domestic credit extension
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:928 , http://hdl.handle.net/10962/d1001454 , Monetary policy -- South Africa , Inflation targeting -- South Africa , Gross domestic product -- South Africa , Bank loans -- South Africa , Money supply -- South Africa , Endogenous growth (Economics)
- Description: This study is about whether the money supply in South Africa under a monetary policy regime of inflation‐targeting is exogenously or endogenously determined. The proposition of an exogenous money supply has been offered by monetarists, where the Central Bank determines the quantity of money supplied to the economy and this has a causal influence on income and credit extension. The endogenous money theory is a post‐Keynesian proposition whereby the money creation is determined by banks adjusting their responses to demands for credit‐money from economic agents. The data analysis is from 2000Q1 to 2010Q4 and entails the use of the variables monetary base (MB), domestic credit extension (DCE), M3, and gross national product (GDP). All variables are logged. The empirical tests conducted start with the Augmented Dickey‐Fuller unit root test to determine the variables order of integration. Johansen cointegration tests are done followed by Vector Error‐Correction Models (VECMs) and Granger causality tests to determine whether there is unidirectional or bidirectional causality between variables over the long and short‐run. Based on the results of the testing it was discovered that over the inflation‐targeting regime money supply in South Africa was endogenously determined. Furthermore, the data best supports the Accommodationist analysis of endogenous money as opposed to that of Structuralism and Liquidity Preference , Adobe Acrobat 9.53 Paper Capture Plug-in
- Full Text:
- Date Issued: 2013
- Authors: Schady, Stuart William
- Date: 2013 , 2013-04-29
- Subjects: Monetary policy -- South Africa , Inflation targeting -- South Africa , Gross domestic product -- South Africa , Bank loans -- South Africa , Money supply -- South Africa , Endogenous growth (Economics) , Domestic credit extension
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:928 , http://hdl.handle.net/10962/d1001454 , Monetary policy -- South Africa , Inflation targeting -- South Africa , Gross domestic product -- South Africa , Bank loans -- South Africa , Money supply -- South Africa , Endogenous growth (Economics)
- Description: This study is about whether the money supply in South Africa under a monetary policy regime of inflation‐targeting is exogenously or endogenously determined. The proposition of an exogenous money supply has been offered by monetarists, where the Central Bank determines the quantity of money supplied to the economy and this has a causal influence on income and credit extension. The endogenous money theory is a post‐Keynesian proposition whereby the money creation is determined by banks adjusting their responses to demands for credit‐money from economic agents. The data analysis is from 2000Q1 to 2010Q4 and entails the use of the variables monetary base (MB), domestic credit extension (DCE), M3, and gross national product (GDP). All variables are logged. The empirical tests conducted start with the Augmented Dickey‐Fuller unit root test to determine the variables order of integration. Johansen cointegration tests are done followed by Vector Error‐Correction Models (VECMs) and Granger causality tests to determine whether there is unidirectional or bidirectional causality between variables over the long and short‐run. Based on the results of the testing it was discovered that over the inflation‐targeting regime money supply in South Africa was endogenously determined. Furthermore, the data best supports the Accommodationist analysis of endogenous money as opposed to that of Structuralism and Liquidity Preference , Adobe Acrobat 9.53 Paper Capture Plug-in
- Full Text:
- Date Issued: 2013
The bank lending and balance sheet channels of monetary policy: a theoretical analysis
- Authors: Gumede, Nomdumiso Beryl
- Date: 2013
- Subjects: Monetary policy Money Bank loans Financial sheets
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:933 , http://hdl.handle.net/10962/d1001864
- Description: The credit channel and its significance in the monetary policy transmission mechanism has been a point of contention among policy makers and economists for many years. In the early stages of this debate the monetarist view shaped thinking on the topic and cultivated the belief that the money supply is exogenously determined and that commercial banks playa minor role in the monetary transmission process. However, over the years, the credit view presented by Bernanke and Blinder (1988) has gained momentum. In contrast to the monetarist view, the credit view abandons the assumption of perfect substitutability and argues that due to their credit provision activities, financial institutions playa significant role in the transmission of monetary policy. The credit channel consists of two sub channels, the bank lending and balance sheet channels. In both, deposits drive loans and changes in monetary policy are effected through interest rates and their impact on borrowers' balance sheets, bank reserves, bank deposits and ultimately the quantity of bank loans supplied. Disyatat (2010) re-examines the conventional view and presents an argument against the foundation upon which the theories are based. Using this as a basis, and motivated by the vast amount of empirical literature that already exists on this topic, both in South Africa and abroad, this research provides a theoretical analysis of the credit channel and its relative importance in the monetary policy transmission mechanism. The exogenous/endogenous nature of money supply is considered and its implications for the existence and operation of the credit channel set out. It is found that, in order for a credit channel to operate efficiently in an economy, money supply should be endogenously determined. Moreover, a theoretical argument supporting Disyatat's (2010) revised credit channel is presented; it is concluded that, with a slight variation to Disyatat's proposed model, a single, unified channel exists.
- Full Text:
- Date Issued: 2013
- Authors: Gumede, Nomdumiso Beryl
- Date: 2013
- Subjects: Monetary policy Money Bank loans Financial sheets
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:933 , http://hdl.handle.net/10962/d1001864
- Description: The credit channel and its significance in the monetary policy transmission mechanism has been a point of contention among policy makers and economists for many years. In the early stages of this debate the monetarist view shaped thinking on the topic and cultivated the belief that the money supply is exogenously determined and that commercial banks playa minor role in the monetary transmission process. However, over the years, the credit view presented by Bernanke and Blinder (1988) has gained momentum. In contrast to the monetarist view, the credit view abandons the assumption of perfect substitutability and argues that due to their credit provision activities, financial institutions playa significant role in the transmission of monetary policy. The credit channel consists of two sub channels, the bank lending and balance sheet channels. In both, deposits drive loans and changes in monetary policy are effected through interest rates and their impact on borrowers' balance sheets, bank reserves, bank deposits and ultimately the quantity of bank loans supplied. Disyatat (2010) re-examines the conventional view and presents an argument against the foundation upon which the theories are based. Using this as a basis, and motivated by the vast amount of empirical literature that already exists on this topic, both in South Africa and abroad, this research provides a theoretical analysis of the credit channel and its relative importance in the monetary policy transmission mechanism. The exogenous/endogenous nature of money supply is considered and its implications for the existence and operation of the credit channel set out. It is found that, in order for a credit channel to operate efficiently in an economy, money supply should be endogenously determined. Moreover, a theoretical argument supporting Disyatat's (2010) revised credit channel is presented; it is concluded that, with a slight variation to Disyatat's proposed model, a single, unified channel exists.
- Full Text:
- Date Issued: 2013
The feasibility of forming a monetary union in SADC : meeting convergence and optimum currency area criteria and evaluating fiscal sustainability
- Authors: Mokoena, Motshidisi Suzan
- Date: 2013
- Subjects: Southern African Development Community Economic and Monetary Union Common Monetary Area (Organization) Economic policy -- Africa, Southern Monetary policy -- Africa, Southern Monetary unions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1073 , http://hdl.handle.net/10962/d1007743
- Description: In conformity with the goal of the African Union to build a monetary union for the entire African continent, one of the goals of the Southern African Development Community (SADC) is the formation of a monetary union with a single central bank. Towards this end certain macroeconomic convergence criteria, which are closely aligned with those used by the European Union (EU), have been set. While empirical research on whether or not SADC would benefit from the formation of a currency union has focused on the optimum currency area criteria, no reference to these criteria is made in the SADC programme. Instead, the SADC approach has been governed by a set of macroeconomic convergence criteria synonymous with those pursued by the European Monetary Union (EMU) prior to its formation. Doubts regarding the future of the EU have recently been raised as a result of debt crises in certain member states, implicitly raising questions about the adequacy of the convergence criteria that were adopted. Accordingly, this study considers the feasibility of establishing a currency union in the SADC region. The proposed convergence criteria are assessed against the theory of optimum currency areas as well as in terms of their adequacy in the light of recent EU experience. In addition, the paper provides a preliminary assessment of the fiscal sustainability of the SADC region by conducting Engle-Granger cointegration tests on the public debt and revenue series for the SADC countries under analysis. It was observed that SADC has made considerable progress towards meeting its macroeconomic convergence criteria in recent years. However, in light of the regions' heavy dependence on commodity exports coupled with recent price fluctuations in this regard, the sustainability of this progress is questioned. Furthermore, a review of the EMU experience to date highlights numerous flaws in its approach and the potential challenges the SADC region should consider in moving forward with its agenda. In essence, the study suggests that almost all the SADC member states are fiscally unprepared for monetary union formation and the recent EMU debt crisis has highlighted the importance of acquiring a state of fiscal sustainability prior to union formation. In addition, it is imperative that the SADC members continue to address issues of product diversification, intraregional trade and political unification, all of which should be governed by a centralised fiscal authoriry.
- Full Text:
- Date Issued: 2013
- Authors: Mokoena, Motshidisi Suzan
- Date: 2013
- Subjects: Southern African Development Community Economic and Monetary Union Common Monetary Area (Organization) Economic policy -- Africa, Southern Monetary policy -- Africa, Southern Monetary unions
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1073 , http://hdl.handle.net/10962/d1007743
- Description: In conformity with the goal of the African Union to build a monetary union for the entire African continent, one of the goals of the Southern African Development Community (SADC) is the formation of a monetary union with a single central bank. Towards this end certain macroeconomic convergence criteria, which are closely aligned with those used by the European Union (EU), have been set. While empirical research on whether or not SADC would benefit from the formation of a currency union has focused on the optimum currency area criteria, no reference to these criteria is made in the SADC programme. Instead, the SADC approach has been governed by a set of macroeconomic convergence criteria synonymous with those pursued by the European Monetary Union (EMU) prior to its formation. Doubts regarding the future of the EU have recently been raised as a result of debt crises in certain member states, implicitly raising questions about the adequacy of the convergence criteria that were adopted. Accordingly, this study considers the feasibility of establishing a currency union in the SADC region. The proposed convergence criteria are assessed against the theory of optimum currency areas as well as in terms of their adequacy in the light of recent EU experience. In addition, the paper provides a preliminary assessment of the fiscal sustainability of the SADC region by conducting Engle-Granger cointegration tests on the public debt and revenue series for the SADC countries under analysis. It was observed that SADC has made considerable progress towards meeting its macroeconomic convergence criteria in recent years. However, in light of the regions' heavy dependence on commodity exports coupled with recent price fluctuations in this regard, the sustainability of this progress is questioned. Furthermore, a review of the EMU experience to date highlights numerous flaws in its approach and the potential challenges the SADC region should consider in moving forward with its agenda. In essence, the study suggests that almost all the SADC member states are fiscally unprepared for monetary union formation and the recent EMU debt crisis has highlighted the importance of acquiring a state of fiscal sustainability prior to union formation. In addition, it is imperative that the SADC members continue to address issues of product diversification, intraregional trade and political unification, all of which should be governed by a centralised fiscal authoriry.
- Full Text:
- Date Issued: 2013
The interest rate elasticity of credit demand and the balance sheet channel of monetary policy transmission in South Africa
- Authors: Doig, Gregory Graham
- Date: 2013
- Subjects: Monetary policy -- South Africa Banks and banking -- South Africa Bank loans -- South Africa Finance -- South Africa Vector autoregression (VAR) approach to econometric modeling Financial statements Interest rates -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1052 , http://hdl.handle.net/10962/d1006482
- Description: It has long been accepted that changes in monetary policy have real economic effects; however, the mechanism by which these policy changes are transmitted to the real economy has been the subject of much debate. Traditionally the transmission mechanism of monetary policy has consisted of various channels which include the money channel, the asset price channel and the exchange rate channel. Recent developments in economic theory have led to a relatively new channel of policy transmission, termed the credit channel. The credit channel consists of the bank lending channel as well as the balance sheet channel, and focuses on the demand for credit as the variable of interest. The credit channel is based on the notion that demanders and suppliers of credit face asymmetric information problems which create a gap between the cost of external funds and the cost of internally generated funds, referred to as the wedge. The aim here is to determine the size and lag length effects of changes in credit demand, by both firms as well as households, as a result of changes in interest rates. A secondary, but subordinate, aim is to test for a balance sheet channel of monetary policy transmission. A vector autoregressive (VAR) model is used in conjunction with causality tests, impulse response functions and variance decompositions to achieve the stated objectives. Results indicate that the interest rate elasticity of credit demand, for both firms and households, is interest inelastic and therefore the monetary policy authorities have a limited ability to influence credit demand in the short as well as medium term. In light of the second aim, only weak evidence of a balance sheet channel of policy transmission is found.
- Full Text:
- Date Issued: 2013
- Authors: Doig, Gregory Graham
- Date: 2013
- Subjects: Monetary policy -- South Africa Banks and banking -- South Africa Bank loans -- South Africa Finance -- South Africa Vector autoregression (VAR) approach to econometric modeling Financial statements Interest rates -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1052 , http://hdl.handle.net/10962/d1006482
- Description: It has long been accepted that changes in monetary policy have real economic effects; however, the mechanism by which these policy changes are transmitted to the real economy has been the subject of much debate. Traditionally the transmission mechanism of monetary policy has consisted of various channels which include the money channel, the asset price channel and the exchange rate channel. Recent developments in economic theory have led to a relatively new channel of policy transmission, termed the credit channel. The credit channel consists of the bank lending channel as well as the balance sheet channel, and focuses on the demand for credit as the variable of interest. The credit channel is based on the notion that demanders and suppliers of credit face asymmetric information problems which create a gap between the cost of external funds and the cost of internally generated funds, referred to as the wedge. The aim here is to determine the size and lag length effects of changes in credit demand, by both firms as well as households, as a result of changes in interest rates. A secondary, but subordinate, aim is to test for a balance sheet channel of monetary policy transmission. A vector autoregressive (VAR) model is used in conjunction with causality tests, impulse response functions and variance decompositions to achieve the stated objectives. Results indicate that the interest rate elasticity of credit demand, for both firms and households, is interest inelastic and therefore the monetary policy authorities have a limited ability to influence credit demand in the short as well as medium term. In light of the second aim, only weak evidence of a balance sheet channel of policy transmission is found.
- Full Text:
- Date Issued: 2013
The value of non-native fish species : a study of recreational angling in the Amathole district
- Authors: Kinghorn, James Wolmarans
- Date: 2013
- Subjects: Fishing -- Economic aspects -- South Africa -- Eastern Cape Introduced fishes -- Economic aspects -- South Africa -- Eastern Cape Fisheries -- South Africa -- Eastern Cape , Non-native fish species , Recreational angling , Amathole district
- Language: English
- Type: Thesis , Masters , MEcon
- Identifier: vital:930 , http://hdl.handle.net/10962/d1001456
- Description: Experience has shown that effective fisheries governance requires a sound understanding of fisheries as systems incorporating both ecological and human dimensions. The Ecosystem Approach to Fisheries requires that the human components of these systems be considered when developing management and governance frameworks. While the potential for inland fisheries to contribute towards societal welfare and the development of rural livelihoods is becoming increasingly apparent, developing South African inland fisheries requires a careful consideration of both their positive and negative impacts, given that they revolve mainly around five of the world‟s top 100 invasive species. This thesis aimed to explore the value of inland recreational fisheries to rural livelihoods in the Amathole District of South Africa, to the regional economy, and to anglers themselves. Three methods were used to isolate this value. Economic impact analysis was used to estimate the combined total economic impact of the 2011 Divisional Tournament (n=31) and the 2012 Amatola Bass Classic (n=100) on the regional economy of the Amathole District, estimated to be R106 625. The travel cost method was applied to data from the 2012 Amatola Bass Classic in order to estimate the social welfare generated by this tournament. The Negative Binomial model, corrected for truncation and endogenous stratification, estimated this value at R 1 960 090. The sustainable livelihoods framework was used to conduct a broad-based analysis of the value of Amatola Wild Trout, the firm which constitutes the fishery surrounding the rural village of Cata. It was found that the fishery had been responsible for a modest pecuniary impact on the community of Cata within its first two years of establishment, although significant improvements in human capital were found to have resulted from the development of the fishery. These results provide insights into the economic dimension of fisheries in the Amathole District, and will prove useful when weighing up the positive and negative impacts of non-native fish species, particularly when informing decisions regarding their potential eradication.
- Full Text:
- Date Issued: 2013
- Authors: Kinghorn, James Wolmarans
- Date: 2013
- Subjects: Fishing -- Economic aspects -- South Africa -- Eastern Cape Introduced fishes -- Economic aspects -- South Africa -- Eastern Cape Fisheries -- South Africa -- Eastern Cape , Non-native fish species , Recreational angling , Amathole district
- Language: English
- Type: Thesis , Masters , MEcon
- Identifier: vital:930 , http://hdl.handle.net/10962/d1001456
- Description: Experience has shown that effective fisheries governance requires a sound understanding of fisheries as systems incorporating both ecological and human dimensions. The Ecosystem Approach to Fisheries requires that the human components of these systems be considered when developing management and governance frameworks. While the potential for inland fisheries to contribute towards societal welfare and the development of rural livelihoods is becoming increasingly apparent, developing South African inland fisheries requires a careful consideration of both their positive and negative impacts, given that they revolve mainly around five of the world‟s top 100 invasive species. This thesis aimed to explore the value of inland recreational fisheries to rural livelihoods in the Amathole District of South Africa, to the regional economy, and to anglers themselves. Three methods were used to isolate this value. Economic impact analysis was used to estimate the combined total economic impact of the 2011 Divisional Tournament (n=31) and the 2012 Amatola Bass Classic (n=100) on the regional economy of the Amathole District, estimated to be R106 625. The travel cost method was applied to data from the 2012 Amatola Bass Classic in order to estimate the social welfare generated by this tournament. The Negative Binomial model, corrected for truncation and endogenous stratification, estimated this value at R 1 960 090. The sustainable livelihoods framework was used to conduct a broad-based analysis of the value of Amatola Wild Trout, the firm which constitutes the fishery surrounding the rural village of Cata. It was found that the fishery had been responsible for a modest pecuniary impact on the community of Cata within its first two years of establishment, although significant improvements in human capital were found to have resulted from the development of the fishery. These results provide insights into the economic dimension of fisheries in the Amathole District, and will prove useful when weighing up the positive and negative impacts of non-native fish species, particularly when informing decisions regarding their potential eradication.
- Full Text:
- Date Issued: 2013