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This paper examines the asymmetric link between carbon pricing and the comparative advantage in environmental goods exports in South Africa from 1995 to 2021. The non‐linear autoregressive distributed lag model is utilized to investigate the effects of both minor and major positive and negative fluctuations in carbon taxes, technological innovation, and energy transition on comparative advantage. The results reveal that carbon taxes have an asymmetric effect on comparative advantage in both the short and long runs, with positive shocks exerting a greater beneficial influence than negative shocks. Specifically, it is found that a 1% reduction in carbon taxes corresponds to a 1.24% decline in the response variable, whereas a 1% increase in carbon taxes is associated with a 2.72% increase in comparative advantage in environmental goods exports, which is twice as large. The study also uncovers evidence of an asymmetric relationship between low‐carbon technological innovation and comparative advantage in environmental goods exports. However, strong evidence of a long‐run asymmetric linkage between the energy transition and comparative advantage is not established. Nevertheless, it is noteworthy that a positive shift in energy transition is linked with a 0.32% rise in comparative advantage in environmental goods exports, whereas a negative shift in energy transition corresponds to a 0.11% decrease. The practical policy implications are also discussed. [ABSTRACT FROM AUTHOR]

This paper revisits the exchange rate pass‐through (ERPT) to inflation in Nigeria and South Africa by incorporating structural breaks and using time series variables, namely the consumer price index, nominal effective exchange rate, gross domestic product, and crude oil price. Based on the Maki cointegration test and a flexible estimation approach of the Autoregressive Distributed Lag (ARDL) model, our empirical evidence suggests that the long‐ and short‐run ERPT to inflation is complete for Nigeria, while for South Africa it is incomplete both in the long run and short run. This result indicates that prices are stickier in South Africa compared to Nigeria. The comparison between Nigeria and South Africa confirms the role of inflation targeting and central bank credibility on the ERPT. The results divulge further that output growth in Nigeria increases inflation in the long run while it is anti‐inflationary in the short run. For South Africa, the effect of output growth is negatively insignificant. In addition, the long‐run effect of oil price is negative and significant for Nigeria, while for South Africa the short‐run effect of oil price is positive and significant. Therefore, the findings of this paper will assist the monetary authorities to achieve monetary policy objectives. [ABSTRACT FROM AUTHOR]

Using a sample of South African state‐owned enterprises (SOEs), we examine the pre‐ and post‐period impact of King III on non‐executive director (NED) compensation with emphasis on financially distressed SOEs. This paper adopts a difference‐in‐differences analysis technique with repeated measures as the basis for testing the hypotheses. The revised Altman Z‐score model which incorporates features unique to emerging markets is used to measure financial distress. Our findings indicate that SOEs that adopted King III will increase NED compensation when the firm has a positive performance and will severely penalize NED when the firm faces financial distress. This study highlights the importance of well‐crafted corporate governance policies. It further sheds light on the importance of King III and how its implementation may prove vital for the success of an enterprise. [ABSTRACT FROM AUTHOR]

China's trade with South Africa has become more important in recent years, and a SACU-China free trade agreement has been proposed to further strengthen this trade relationship. This paper examines the relevance of this proposed trade policy for further enhancing bilateral trade flows and development in SACU. The paper finds that tariff liberalization alone is inadequate for successful trade integration, as it benefits mostly South Africa only and harms some of SACU's internal and external trade and its welfare through trade diversion. Measures to improve trade complementarity, reduce barriers to intra-industry trade, and implement parallel MFN trade liberalization should also be undertaken by SACU in order to achieve successful trade integration with China. [ABSTRACT FROM AUTHOR]

This paper evaluates a topic in the globalization and poverty debate that is often difficult to measure, namely the transmission of price changes associated with tariff liberalization to households. Furthermore, it raises the question of whether there are discernible differences between male- and female-headed households that affect this consumption-trade link. It is a partial analysis as a consequence, but one that demonstrates the importance of such a focus for continued research and policy development surrounding the impacts of globalization. Specifically, the paper evaluates how tariff changes impacted male- and female-headed households in South Africa over the discrete periods 1995, 2000, and 2004. The analysis of consumption trends by sex of household head shows statistically significant differences which confirm that resources are managed differently between the sexes, and these are transmitted through to the tariff incidence analysis. On the whole, it was found that: (1) male-headed households almost always bear a greater share of the tariff incidence compared to female-headed; (2) both male- and female-headed households — across all expenditure quantiles other than the most wealthy — bear a greater share of the tariff burden compared to their share of total expenditure; and (3) changes to the incidence over 1995, 2000, and 2004 between the sexes mimicked the trends for the population as a whole, but showed crucial differences at the bottom end of the expenditure distribution. This suggests that the sex of the household head matters, and must be considered in addition to other household identifying factors (e.g. socio-economic status) when evaluating the impacts of tariff liberalization. [ABSTRACT FROM AUTHOR]

The paper examines the role of personal characteristics in not only determining the unemployment duration but also the probability of unemployment terminating with transitions into wage-employment, self-employment or higher education. Formulated within the survival analysis framework using the Labour Market Entry Survey, this study provides the first empirical evidence on black youth unemployment duration in South Africa. The results of the analysis indicate non-monotonic duration dependence with other individual, household and locational covariates exerting very different impacts on the state-specific exit rates from unemployment for both young men and women. The scarring impact evident in negative duration dependence and gender-specific findings point to the need for more informed policy formulation. [ABSTRACT FROM AUTHOR]

This paper surveys frameworks of labour migration in southern Africa and determines South Africa's policy responses to inflows of migrants from seven neighbouring countries. Legislations, policy reports and scientific publications on migration were thoroughly reviewed and interviews and correspondence with key policymakers were conducted. Statistical analyses of data on foreign worker recruitments and permits issued by South Africa's Department of Home Affairs were also performed. The absence of a migration protocol in southern Africa suggests SADC Members have not implemented the African Union's migration policy basic guidelines. Two systems coexist in southern Africa that complicate migration governance: a South Africa-managed bilateral migration policy, and aspirations for a formal SADC-managed migration policy. Bilateral agreements between South Africa and neighbours have established a labour migration system that dims prospects for a regional migration policy. SACU Members could establish a two-tier policy to achieve free movement while maintaining managed migration policy outside SACU. An official multilateral migration governance mechanism would serve SADC better than the current ad-hoc measures. [ABSTRACT FROM AUTHOR]

Discussions on introducing a deposit insurance scheme in South Africa have been floating around since 2000, without any official proposal being published or brought to Parliament. Globally, countries have increasingly adopted deposit insurance schemes with the understanding that they provide a public benefit of increasing confidence in the financial system. It is likely that South African banks and government have resisted introduction of any scheme owing to costing issues. This paper estimates the cost of deposit insurance premiums for seven large South African banks for the first time, annually over the period 2000 to 2009 using an option-based model. The premiums exhibit high volatility over time and across banks but yield an average value that is internationally comparable. The authors also propose a risk-weighted, multi-tier premium structure to encourage appropriate pricing for different categories of risk. [ABSTRACT FROM AUTHOR]

This paper investigates the relationship between health and productivity in South Africa. It tests for unit roots and structural breaks and uses the outcome to perform causality and simultaneous equations estimations. The results suggest that without structural breaks, the effect of health on productivity is downplayed. They highlight how long people live does not matter for productivity, the improvements in their lifespan does. Long life can improve productivity only if it is a healthy long life. The impact of improvements of levels of health on productivity is less than 25 per cent of that of improvement of growth rates of health. Improvements in both the levels and growth of male life expectancy enhance productivity more than those of females; an increase in productivity increases the levels of female life expectancy more than those for males. HIV/AIDS significantly reduces levels of life expectancy (with greater impact on females) and labour productivity. Overall, macroeconomic policy for health and growth cannot be conceived separately. Efforts to fight against HIV/AIDS can improve life expectancy and productivity, leading to higher growth. Females may be more vulnerable to die of HIV/AIDS related diseases than males are. Anti-AIDS programmes can have biased effects in favour of female health, although in itself this may not be enough to bring about gender-balanced improvements in health. [ABSTRACT FROM AUTHOR]

The paper provides empirical analysis on the linkage between the behavior of bank lending and business cycles in South Africa. Consistent with theory, overall evidence suggesting pro-cyclicality of bank lending is uncovered both at macro and micro levels. At macro level, bank lending and lending rates have moved in tandem with business cycles. Real borrowing by government was counter-cyclical to business cycles as would be expected if the role of government was to fine-tune the economy during booms and recessions. At micro level, bank lending to households and firms was generally pro-cyclical. Even the growth of provisioning by banks has been largely pro-cyclical to business cycles, though exceptions were recorded. First, new mortgage lending exhibited counter-cyclical behavior before 1993. We attributed this behavior to the political and economic climate prevailing then which created uncertainties that made ownership of property a good hedge against economic and political risks. Secondly, the growth of real credit for investment and of foreign trade finance does not appear to have been related to business cycles. [ABSTRACT FROM AUTHOR]

In this paper, we address two major questions. First, the question of whether China and India are displacing the African manufacturing export from the third market. Second, whether there is an evidence of shifting comparative advantage from China and India to Africa. We employed a gravity model with a panel data using 13 African exporters of clothing and accessories for the period 1995–2005 to answer the first question. To answer the second question, we used a flying-geese model and estimated Spearman's rank correlation coefficients on indices of the revealed comparative advantage vectors of the African exporters and China and India for the same period. Both the gravity and flying-geese models predicted similar outcomes. We found that there is strong evidence that China has been displacing African manufactures from the third market while India has been complementing it in the early years of the study. However, the overall third market impact of China and India has been that of complementarity in the later years of the study period. This result is found to vary across countries. Furthermore, we found evidence of shifting comparative advantage from China and India to Africa as the flying-geese theory predicts, South Africa being the leading goose followed by Kenya. The major implication of the study is that, in the world where China and India are reshaping the global economic order dynamically, the outcomes of the traditionally received wisdom of trade liberalization and industrialization policies through export promotion may be uncertain and requires strategic thinking. [ABSTRACT FROM AUTHOR]

South Africa, in an attempt to reduce unemployment and alleviate poverty, has implemented a number of public sector conservation projects: the largest one being the Working for Water Programme(WfWP). Sound economic decision-making regarding the economic feasibility of these public sector conservation projects require that they be subjected to economic assessment in the form of cost-benefit analysis. One aspect of cost-benefit analysis, which is often neglected, is the choice of the social discount rate. This paper addresses the issue of what the social discount rate for public sector conservation projects should be and provides an example of how to derive a social discount rate for a public sector conservation project, namely the WfWP. [ABSTRACT FROM AUTHOR]

This paper examines the dynamic of currency substitution (CS) in Egypt and South Africa. The study also assesses the causal relationships of this phenomenon. There are three main CS-related differences between the two countries. These are (1) the orientation of economic policy, (2) the degree and level of CS, and (3) the trend of CS. During the study period 1991-2001, Egypt used the exchange rate as an anchor to its economic programme. While in the case of South Africa, the authorities directly targeted inflation. During this period, CS in Egypt started at a substantial level and experienced a steady decline. Conversely, CS in South Africa started at an insignificant level, but observed an uninterrupted increase. The results suggest that the elasticity of CS, with respect to exchange rate, of South Africa is 2.3 times that of Egypt, and that the speed of adjustment in South Africa is 5 times faster than in Egypt. Granger-causality tests indicate a unidirectional relationship from the exchange rate to CS, in both Egypt and South Africa. The test for the interest rate differential and CS indicate that causality runs from the former to the latter in South Africa, but it runs in the opposite direction in Egypt. The study suggests that despite the cost of the exchange rate anchoring policy, it is more suitable to a high CS environment. Inflation targeting policy can be effective in achieving its objective as long as the CS is insignificant. [ABSTRACT FROM AUTHOR]

The requirement for the improvement of poor people’s basic needs and overall quality of life is inseparable from concerns with sustainability and state capacity for executing social welfare responsibilities. South Africa has, paradoxically, redefined state role away from social provision, as it replaced the Reconstruction and Development Programme (RDP) with the Growth, Employment and Redistribution (GEAR) strategy in 1996. Whereas the RDP accorded the state a pivotal role in meeting basic needs, GEAR pursued outward-looking development. In accordance with the logic of GEAR, the Northern Province Government formulated its Growth and Development Strategy (GDS), essentially an offspring of that macro-policy. Using the Northern Province as case study, this paper illustrates that GEAR and GDS have engendered outward-looking development that is also open to the dictates of external forces. It is argued that South Africa and that province are as such inserted into the global system in a way that they cannot shape or domesticate globalization for resolution of their germane development difficulties. We point out that that form of globalization has not led to the improvement of the poor people’s access to basic needs. In conclusion, we urge for the establishment of a strong developmental state that would engender auto-centeredness. [ABSTRACT FROM AUTHOR]