The neoclassical theory suggests that free flows of external capital should be equilibrating and thereby facilitating smoothening of an economy's consumption or production patterns. South Africa has a very low savings rate, making it highly dependent on capital inflows which create instability and volatility in global markets. A policy dilemma is undoubtedly evident: capital inflows help to cater for the domestic low savings and at the same time the inflows pose instability, a threat on competitiveness and volatility challenges to the same economy due to their impact on exchange rates. The question is: are all forms of capital flows equally destabilizing? Since studies based on South Africa considered only the relationship between aggregate capital flows and real exchange rate, modelling individual components of capital flows could enlighten policy formulation even further. The composition of the flows and their effects on the composition of aggregate demand determine the evolution of real exchange rate response to surges in capital flows. Through co-integration and vector error correction modelling techniques applied to South African data between 1990 and 2010, the study found out that foreign portfolio investment exerts the greatest appreciation effect on the South African real exchange rate, followed by other investment and finally foreign direct investment. Thus the impact of capital flows on real exchange rate in South Africa differs by type of capital. This presents varied policy implications.

The dissertation consists of four empirical papers in the field of monetary economics. The first paper examines the extent of real exchange rate misalignment in the selected euro area countries, the next two papers shed light on macroeconomic spillovers in the remaining EU countries which are not part of the single currency area, while the last paper focuses on the exchange rate pass-through in the Czech Republic.

This study explored the role of school-based teacher financial incentives on student academic achievement. Despite great efforts made by Zimbabwean government towards improving the education system in terms of infrastructure development and increasing number of schools, prior and after 1980, not much attention had been paid to the role of teachers’ extra-financial incentives on enhancing teacher motivation which leads to student achievement in and outside classroom situation. Extra-financial incentives differ from government to government depending on the revenue base and political will by such governments to support these teacher incentives programmes. In developed countries, respective governments pay different teacher incentives while in developing countries, parents/guardians or School Development Committees (SDCs) shoulder the burden. This study contented that one of the ways to improve student achievement has been payment of school-based teacher incentives to supplement teachers’ low salaries. While the need to adequately compensate teachers had been a worldwide phenomenon, this is in contrast to Zimbabwean experience after 2014, when Government of National Unity (GNU) came to an end. Zimbabwean government banned payment of teacher incentives under unclear reasons which were widely purported to be political. This research adopted a qualitative approach and as such, collection of primary and secondary data were done using multiple data collection techniques. Techniques included interviews with key informants, focus group discussions and open ended questionnaires in selected secondary schools. Results from this study revealed that improving teacher motivation through school-based incentives had been central to improved student achievement. In schools where teacher incentive system was practiced pass-rates increased, with a sudden decline when teacher incentives were banned. Banning or lack of properly designed incentive systems, where teachers were consulted, was seen as negatively affecting student achievement in selected secondary schools of Makoni District. / Educational Foundations / D. Ed. (Socio-Education)