M.Com. (Economics) / The objective of this thesis is to describe the nature of the South African economic system for the period 1970-1985 in macroeconomic terms. As an introduction to the specific analysis of the South African economic system, the author also discusses the socio-economic nature of economic systems per see Based on an identification- and classification framework which was developed as a result of a literature survey in this regard, the author made extensive use of the Quarterly Bulletins of the South African Reserve Bank and the South African Statistical Service's two-yearly publication of collective South African statistics in order to analyse the nature and extent of the most important macroeconomic variables in the South African economy. As a resu 1t of the macroeconomic analysis, the author came to a number of conclusions regarding the South African economic system during the period 1970-1985. The conclusions were, inter alia: The South African economic system could best be described as a mixed economy in which the Government played a substantial and increasingly important role in terms of its contribution to the GDP and other important macroeconomic variables. Although South Africa experienced an average increase in its real GDP of approximately 2,6% per year, the country had an average yearly population growth of 2,8% during the relevant period, with the result that the real per capita GOP in 1985 was lower than the corresponding 1970 figure. It should also be noted that the GOP declined in real terms for the first time in fifty years between 1981 and 1983 and between 1984 and 1985. Other meaningful conclusions concerned the drastic decline in the purchasing power of the Rand, the substantial influence of the foreign sector of the economy, the disparity between the average compensation packages for the White and Nonwhite subgroups of the population, the changing importance of the different sectors of the economy in terms of their contribution to the GOP and other economic variables, an increase in the percentage of women who were active in the economy during this period, the poor performance of the multi input index of productivity, sharp fluctuations in company savings and a greater reliance on passive forms of business income.

M.Comm. / In considering the challenges and pitfalls of South Africa's global integration, the circumstances preceding the liberalisation attempt of the 1980's were considered. The De Kock approach to liberalising the economy was unsuccessful owing to the real side of the economy not being in a position to support the liberalisation of the dynamic financial sector. The role of sequencing appears to have been ignored. The lack of government stabilisation was a primary factor contributing to the failure of this liberalisation attempt. Foreign investors, who had been attracted by the well-developed financial sector, lost confidence when exposed to the accompanying backward real sector. Contrary to authorities' initial aim, this premature liberalisation attempt was fatally disrupted by trade and financial sanctions imposed against South Africa. This placed South Africa's ability to meet its international debt commitments in jeopardy. Foreigners refused to roll over debt, and this resulted in a debt standstill in September 1985. To save the crumbling economy, a surplus on current account of balance of payments had to be imposed as a policy measure in order to pay back foreign debt. Although this may have seemed sensible to the authorities at the time, the negative effect that such a policy of price adjustments would have on investment, and therefore growth, was ignored. On examining the correlation between investment and the current account post 1985, it is clear that the current account was in surplus as investment declined. This strongly suggests that investment was the adjustment variable which induced the current account surplus. This paper suggests that such a situation could have been avoided had more attention been given to the sequence in which the economy was opened up. A Smithian approach is proposed. Regression analysis is employed in order to develop an investment function. This model clearly shows that a depreciating exchange rate impacts negatively on investment. Thus the maintenance of a current account surplus was not in the interests of investment growth, and hence economic growth. Rather than relying on balance of payments adjustments, South Africa should possibly have allowed a greater role for organised sequencing. The first step in the Smithian series is the liberalisation of the real sector. Recent World Trade Organisation negotiations have contributed to progress in this regard. The real sector is making good progress in integrating with the world economy. However, it is possibly being hindered by the reluctance of the government to liberalise the foreign exchange market. Stabilisation, the second step in the series is being hindered by the aforementioned reluctance in terms of the foreign exchange market, and by fiscal policies which are lagging behind the progress of monetary policy. The primary problem in terms of fiscal policy is that the authorities have yet to recognise the complementarity of price as well as income adjustments. Financial markets are liberalising fast. The primary concern here is that these markets are opening up in favour of foreigners, rather than in favour of residents. Such lopsidedness may hinder the effectiveness of a liberalisation attempt. Therefore, if South Africa is to open up its economy in the well structured Smithian manner, we need to: speed up foreign exchange market liberalisation; recognise the complementary role of price and income adjustments in attaining a tighter fiscal stance; attempt to open up the financial sector in favour of residents as well as non-residents.

M.Com. (Economics) / Please refer to full text to view abstract

Human capital is an important economic concept. The significance of human resource development, in the form of both education and health, has long been realised and was stressed even in the writings of the early economists. Introduction, p.1

Foreign Direct Investment (FDI) is a powerful driver of economic growth and development, particularly in the developing world. FDI can lead to greater efficiencies in the local economy through a number of different channels such as the transfer of technology, increase in competition, and job creation. This dissertation discusses the costs and benefits derived from FDI as well as examining various complementary issues to FDI, such as the relevance of fiscal incentives and the varying effects of different modes of entry. This study further analyses the determinants of FDI into South Africa for the period 1961-2009, through the use of two different econometric techniques – time series and panel data analysis. The results from the time series analysis concur largely with previous studies, finding market size, exchange rate, macroeconomic (in)stability and infrastructure to all be statistically significant determinants of FDI inflows into South Africa. South Africa underwent a major political and economic change in 1994 with the end of Apartheid. This fundamental shift in the economy has also affected the determinants of FDI into the country. To this end a panel data analysis was conducted between 1994 and 2009, the results of which are more suitable for forecasting. This analysis found similar results to the time series analysis, although the relative importance of the determinants varies somewhat, and two additional variables – education and labour productivity – were also found to be statistically significant determinants in the panel data analysis. The dissertation concludes by discussing the policy implications that derive from the findings of the econometric analysis and offers some policy advice in terms of attracting greater FDI into South Africa, based on the findings of this analysis. / Thesis (M.Com.)-University of KwaZulu-Natal, Pietermaritzburg, 2011.

The purpose of this paper was to evaluate if the macroeconomic change that has occurred in the South African economy since the 1980s has been significant enough to justify a re-examination of the actuaries’ capitalisation rate, due to its formulation processes dependence on the macroeconomic situation. The need for the reexamination arises from the use of the capitalisation in the calculation of lump sum awards where even a small change in the rate can have a significant impact on the value of the final award. In order to address the issue an examination of how Keynesian expectations are formulated and an examination of the Government’s macroeconomic policy was conducted to provide the foundation. On this foundation, a trend analysis of the major groups of financial instruments, as well as the current outlooks for the South African economy, was conducted to determine if there was any indication of a significant change in the macroeconomic conditions. The results of the analysis provided a compelling case for the urgent need for the actuaries’ capitalisation rate to be recalculated to account for the changed economic situation.

[The] region, as defined, excludes not only these metropolitan areas themselves but also the inner peripheries of their hinterlands. Thus, virtually all areas within regular (i. e. daily) commuting distance of the metropolitan centres, and all areas into which urban development in the latter might 'spill over' in the foreseeable future are excluded. In the case of Metropolitan Port Elizabeth, these exclusions are reflected in the roughly 'crescent-shaped' southern boundary of the region. The situation of the region can further be described in terms of its major physiographic features which reveal a number of factors which are also of importance for understanding and analysing the economy of the area. Intro., p. 1.

M.Com. (Economics) / Please refer to full text to view abstract

Financial liberalisation, through increasing investment as well as the average productivity of capital, should stimulate economic growth, or so the theory goes. Bank lending unfortunately suffers adverse selection and moral hazard effects, to which the establishment and expansion of stock markets has been offered as a remedy. However, research from developing country stock markets have shown that in many cases these markets did not complement the effects of credit market liberalisation but in rather important aspects subverted them. Countries that implemented credit market liberalisation and raised real interest rates only increased the price of debt capital rather than all capital. This caused a share price boom in many of them. When the price of equity capital fell it seriously undermined and indeed allowed large private corporations to skip altogether the main channel of high interest rates through which the theoretical McKinnon-Shaw effects were to operate. This study asks the research question of what effect the expansion of the South African stock exchange has had for its economic development. It makes use of a general empirical model to explain the relationship between financial development and real output. The model comprises indicators for growth, banking system development, stock market volatility; and, stock market development through a conglomerate index that accounts for market size, liquidity and integration with world capital markets. Quarterly data from 1989 to 2001 is analysed based on the null hypothesis that, as far as financial architecture is concerned, the development of the JSE Securities Exchange has stimulated the country's economic growth. This study found a negative and statistically significant relation between stock market development and economic growth. It suggests that while the JSE Securities Exchange is a relatively large stock market it is the presence of thin trading that prevents the proposed benefits of market development from accruing to the economy. Thus the hypothesis is rejected. However, since the only stable cointegrating vector is between growth and banking sector development, it recommends that by expanding their universal banking functions, the present banking structure, though oligopolistic, may be better suited to act as a catalyst for growth. / Business Management / D. Comm.

D.Comm. / The purpose of this study is to investigate the ways in which future development policy for post-apartheid South Africa must be structured. The motivation for the study stems from, firstly the way in which development issues were handled in the past, secondly the unique problematic nature of South Africa's development, and thirdly the shortcomings in the present proposals for development policy. If one examines the latest tendencies in the international literature on development policy, a shift in emphasis in the international approach to development since the late 1980s is discernible. Whereas the earlier emphasis in development policy was on the generating of economic growth which would have to trickle down to all levels of society, there has more recently been an increasing awareness of the important role which people must fulfil in the development process. According to the latest international literature on the subject, development must be a sustainable and humancentred process in which the protection of the environment, human security, and economic growth must be taken into account. As regards South Africa's development experience, this study came to the conclusion that the ways in which development issues were historically addressed were not successful. All policy initiatives were directed at the development of First World structures, the promotion of economic growth and the uplifting of minorities, while a ceiling was placed on opportunities for the development of the majority of the country's people. An economic growth pattern for development was thus advocated in which people and their development fulfilled a subordinate role. Although since the 1980s attempts have been made to stimulate development, these did not have political legitimacy in the eyes of the broader population and did not take place in a co-ordinated manner. The consequences of these policy initiatives are reflected in South Africa's current development problems. For the broader population, access to health, education and other essential services is either lacking or is of a poor quality. Human security is seriously threatened. Dualism occurs as regards the standard of human development and it is especially the black population, women and rural communities which have the greatest need for investment in human development. South Africa has limited environmental resources and in some areas has to deal with a degenerated environment. As regards economic growth, the economic growth pattern over the last two decades has seen the weakening of distribution of income, a reduction in per capita income and an increase in unemployment. The consequence of this is that approximately half of the population lives in poverty. Although since the early 1990s various policy documents have appeared with the aim of making policy proposals about the ways in which growth and development must be stimulated, none of these documents - including the Reconstruction and Development Programme - offers a satisfactory policy framework in which future development policy must be structured. As regards South Africa's unique development problems, the following proposals for a framework for future development policy are made: Development is the long-term goal which we endeavour to achieve. If a country really wants to benefit from the development process, it is necessary that development be a sustainable process. Sustainable development implies that development policy and decision-making in this regard must not only benefit the present generation, but future generations as well. A prerequisite for sustainable development, however, is that it must be humancentred. Development can therefore not be successful unless people and their choices are central to the development process. The humancentredness of development must therefore constitute the axis around which all development activities in South Africa must evolve. In order to ensure that sustainable development will be humancentred, it must, in accordance with the vision of the United Nations, be "pro-people, pro-jobs and pro-nature." Sustainable development is therefore a multidimensional and allinclusive concept with different dimensions. The discussion of a policy framework for South Africa examines the different dimensions which must be addressed in the development process in order to ensure that development in the long term will be people-centred and sustainable. The dimensions to be discussed include the social, economic, ecological, and also the political dimensions. Turning first to the social dimension, the ways in which people can be developed and their needs can be satisfied are discussed. Human development is thus regarded as the social dimension in the striving for sustainable development. Secondly the protection of the environment is discussed as the ecological dimension in the development process. Thirdly the striving for sustainable job-creating economic growth is regarded as the economic dimension in the development process. Lastly the political dimension of the development process is discussed, as it affects the successful formulation and facilitation of development policy. In addressing the different dimensions of the development process, the humancentreciness of the process must always be kept in mind. Humancentred development will clearly form the most important link in the striving for sustainable development in South Africa.