Thesis (M.Com (Economics)) --University of Limpopo, 2018 / The burden of public debt is an economic issue, dominating debates in different sectors of our society. The post financial crisis era has been marked with an increasing level of public debt at international, national and sub-national level. The study investigates if public debt can affect economic growth in South Africa, for the period 1995 to 2016. The results for Johansen test of cointegration signposted the existence of cointegration among variables observed in this study. The trace statistic and max-eigen value complimented each other to confirm the cointegration, thus, showing a long run relationship. Furthermore, the Vector Error Correction Model (VECM) is applied to achieve the objectives of the study, complemented by other econometric tests such as, Granger causality, impulse response function and variance decomposition. The VECM results revealed the existence of a short run relationship between public debt and economic growth. Granger causality results have shown that public debt can Granger cause economic growth, and there is bi-direction relationship between the two variables. The results for Variance Decomposition indicate that, a shock to public debt causes 1.509115 % fluctuation in economic growth in the second quarter. In the fourth quarter, a shock to public debt account for 16.39628 % fluctuations in economic growth. This shows that, as time goes on, a shock to public debt account for a high percent of fluctuation in economic growth. The Impulse Response Function has shown that, the period of ten quarters marks a negative response of economic growth to public debt. Thus, one standard deviation shock in public debt will inversely affect economic growth. The diagnostic tests such as serial correlation and heteroskedasticity bode well for the model because, neither serial correlation nor heteroskedasticity has been found. Moreover, the model has shown that the residuals are normally distributed, and also the stability of the model has been confirmed. The study recommends that, since South Africa is a capital scarce country, it is encouraged to borrow so that there is an increase in the accumulation of capital. However, the later stage of borrowing marked with high debt will lead to subdued economic growth. / SETA

The main structural characteristic of the International Monetary System (IMS) is its highly hierarchical character, the consequences of which are manifested themselves within the economic system. In the less developed economies, in particular, these consequences may occur in the form of "weak" or inconvertible currencies, less financing opportunities through the financial market and greater instability of capital flows, as well as deterioration of the level of internal autonomy regarding the use of economic policies in the process of development and macroeconomic stability of each national economy. Among the phenomena that unfold from the hierarchy of national currencies is the original domestic sin, which is related to the difficulty that some countries present in the issuance of public debt bonds in the domestic market denominated in local currency and which are simultaneously fixed and long-term. Among the negative consequences of this phenomenon are the mismatch of liabilities and assets of public accounts and the deterioration of the government's solvency capacity in the presence of exchange devaluations or high interest rates and inflation. In addition to seeking to overcome the domestic original sin in Brazil, the present study has it is importance backed by the fragility of the Brazilian currency in the international hierarchy and, consequently, it’s greater exposure to risk and dysfunctions that result from it. The objective of this study is to calculate the indices referring to domestic original sin between 2001 and April 2016 in the Brazilian federal securities market. For this, the calculation of three distinct and complementary indices formulated by Hausmann and Panizza (2003) were used. Among the results obtained, it was possible to verify that the reduction of the external public debt burden was carried out at the cost of the substantial increase of the public indebtedness base through the securities market. It is also observed that in the period evaluated the federal public securities market in Brazil experienced significant transformations. However, domestic federal securities debt is currently heavily indexed to inflation and with significant participation of low maturity fixed rate securities, as well as maintaining a considerable portion of SELIC indexed securities. It was evidenced by the results of the indices that the measures implemented by the Federal Government throughout the decade of 2000, led to a change in the form of manifestation of original domestic sin, however, without any sensible change in its acute magnitude in the Country. / O Sistema Monetário Internacional (SMI) tem como principal característica estrutural seu caráter altamente hierarquizado, cujas consequências se projetam no âmbito do sistema econômico. Nas economias menos desenvolvidas, em particular, essas consequências podem ocorrer sob a forma de moedas ―fracas‖ ou inconversíveis, menores oportunidades de financiamento via mercado financeiro e maior instabilidade dos fluxos de capitais, bem como deterioração do nível de autonomia interna, no que se refere ao emprego de políticas econômicas no processo de desenvolvimento e estabilidade macroeconômica de cada economia nacional. Dentre os fenômenos advindos da hierarquia das moedas nacionais destaca-se o pecado original doméstico, que se relaciona com a dificuldade que alguns países apresentam na emissão de títulos da dívida pública no mercado interno denominado em moeda local e que sejam, simultaneamente, prefixados e de longo prazo. Entre as implicações negativas decorrentes desse fenômeno estão o descasamento do passivo e do ativo das contas públicas, e a deterioração da capacidade de solvência do Governo na presença de desvalorizações cambiais ou elevada taxa de juros e inflação. Além de buscar suprir a carência de estudos que investiguem o pecado original doméstico no Brasil, o presente estudo tem sua importância respaldada pela fragilidade demonstrada pela moeda brasileira na hierarquia internacional e, consequentemente, sua maior exposição aos riscos e disfunções que dela decorre. O presente trabalho tem o objetivo de calcular os índices referentes ao pecado original doméstico entre 2001 a abril de 2016 no mercado de títulos federais brasileiros. Para tanto, empregou-se o cálculo de três índices distintos e complementares formulados por Hausmann e Panizza (2003). Dentre os resultados obtidos foi possível constatar que a redução do peso da dívida externa pública se processou ao custo da ampliação substancial da base de endividamento público via mercado mobiliário. Também se constata que no período avaliado, o mercado de títulos públicos federais no Brasil experimentou expressivas transformações. No entanto, a dívida pública mobiliária federal interna, atualmente, se caracteriza por ser fortemente indexada à inflação e com significativa participação dos prefixados de baixa maturidade, além de manter uma parcela considerável de títulos indexados à SELIC. Evidenciou-se pelos resultados dos índices que as medidas implementadas pelo Governo Federal ao longo da década de 2000, levaram a uma mudança na forma de manifestação do pecado original doméstico, entretanto, sem qualquer alteração sensível em sua aguda magnitude no País.