Dissertation (PhD)--Stellenbosch University, 2003. / ENGLISH ABSTRACT: The endogenous money theory states that the money supply responds
endogenously to the demand for credit. The money supply is not exogenously
determined by the central bank. The endogenous theory is associated with the
Post Keynesian school. It has been tested extensively for developed countries,
where it was found that the modern credit-driven world is characterised by an
endogenous money supply.
The contribution of the present study is to extend this analysis to developing
countries, specifically twelve countries in the SADC region. To examine the
applicability of the endogenous money theory to developing countries, the thesis
begins with an overview of the views of the different schools of thought on the
role of money. The areas of consensus and disagreement within the Post
Keynesian school are discussed. The theoretical basis of the thesis is the
‘structuralist’ Post Keynesian view that money cannot be endogenous if the
financial system in a country has not reached the final stages of development.
The ‘structuralist’ hypothesis is tested for the SADC countries by examining the
demand and supply of credit money in each country. It was found that
households do not generally have full access to formal credit markets. Changes
in the money supply are not determined by changes in private sector credit in
many of the countries. The analysis was then extended to the institutional
environment in each country. A financial institutional index was developed to
facilitate comparison between the SADC countries. It was shown that South
Africa is the only country in the SADC area that has a financial system that can
be classified as ‘largely developed’. It is also the only country where changes in
the supply of money are predominantly credit-driven.
Post Keynesians maintain that the money supply is endogenous and interest
rates are exogenous. Interest rate mark-ups and spreads are assumed stable
over the business cycle. This notion is challenged by the ‘structuralist’ Post
Keynesians. To test the theory of stable interest rate mark-ups and spreads, data
for each individual country were examined. Neither interest rate spreads, nor
interest rate mark-ups were found to be stable. Interest rate spreads are
generally higher in developing countries than in developed countries. No clear
pro- or counter-cyclical variation in spreads was found.
Finally, an econometric model was developed and the links between financial
development and growth were examined. By looking at 49 developed and
developing countries, it was found that financial development is strongly linked to
economic growth. Financial repression and high interest rate spreads cause
growth to be depressed. Financial development and increased competition in the
banking sector will lead to higher real economic growth rates. In an environment
where the financial system has not reached the stage where money is
endogenous, the lack of financial institutional development stifles economic
growth. / AFRIKAANSE OPSOMMING: Die teorie van ‘n endogene geldvoorraad aanvaar dat die aanbod van geld
endogeen reageerop die vraag na krediet. Die geldvoorraad word nie eksogeen
bepaal deurdie sentrale bank nie. Die endogene gedvoorraad teorie word
geassosieer met die Post Keynesiaanse skool. Dit is reeds getoets vir
ontwikkelde lande, waar die bevinding was dat ‘n endogene geldvoorraad ‘n
eienskap is van ‘n moderne kredietgedrewe wereld.
Hierdie tesis maak ‘n bydrae deur die analise uit te brei na ontwikkelende lande,
spesifiek twaalf lande in die SADC streek. Om die toepasbaarheid van die
endogene geldvoorraad vir ontwikkelende lande te toets, begin die tesis met ‘n
oorsig van die verskillende denkskole se sienings oor die rol van geld. Die areas
waar Post Keynesiane ooreenstem en verskil word bespreek. Die teoretiese
basis van die tesis is die ‘strukturalistiese’ Post Keynesiaanse siening dat die
geldvoorraad nie endogeen kan wees indien die finansiele sisteem in ‘n land nog
nie die finale ontwikkelingstadia bereik het nie.
Hierdie hipotese van die ‘strukturaliste’ word getoets vir die SADC lande deur te
kyk na die vraag na en aanbod van krediet in elke land. Daar is bevind dat
huishoudings oor die algemeen nie volledige toegang het tot formele
kredietmarkte nie. Veranderinge in die geldvoorraad word nie in al die lande
veroorsaak deur veranderinge in privaat sektor kredietverlening nie. Hierdie
analise word dan uitgebrei na die institusionele omgewing in elke land, ‘n
Finansiele institusionele indeks is ontwikkel om vergelyking tussen die SADC
lande moontlik te maak. Daar is bevind dat Suid Afrika die enigste land is met 'n
finansiele sisteem wat geklassifiseer kan word as ‘grotendeels ontwikkeld’. Dit is
ook die enigste land waardie geldvoorraad beduidend kredietgedrewe is.
Post Keynesiane glo dat die geldvoorraad endogeen is en rentekoerse
eksogeen. Rentekoersmarges word gesien as stabiel oor die konjunktuursiklus.
Hierdie aanname word bevraagteken deur die ‘strukturalistiese’ Post
Keynesiane. Die teorie van stabiele rentekoersmarges word getoets deur te kyk
na data vir elke individuele land. Die bevinding is dat rentekoersmarges nie
stabiel is nie. Marges is oor die algemeen hoer in ontwikkelende lande as in
ontwikkelde lande. Daar is geen duidelike pro- of kontrasikliese variasies in
rentekoersmarges gevind nie.
Laastens is ‘n ekonometriese model ontwikkel om die skakels tussen finansiele
ontwikkeling en groei te ondersoek. Deur te kyk na 49 ontwikkelde en
onontwikkelde lande, is daar bevind dat finansiele ontwikkeling en groei ‘n sterk
verband toon. Finansiele onderdrukking en hoe rentekoersmarges lei tot laer
ekonomiese groei. Finansiele ontwikkeling en groter mededinging in die bank
sektor sal lei tot hoer reele ekonomiese groeikoerse. In ‘n omgewing waar die
finansiele sisteem nog nie die stadium bereik het waar geld endogeen is nie, sal
die gebrek aan finansiele institusionele ontwikkeling ekonomiese groei benadeel.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/53408 |
| Date | 04 1900 |
| Creators | Theron, N. |
| Contributors | Moore, B. J., Stellenbosch University. Faculty of Economic and Management Sciences. Dept. of Economics. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | Unknown |
| Type | Thesis |
| Format | 452 p. |
| Rights | Stellenbosch University |
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