IDEAS home Printed from https://ideas.repec.org/a/cuf/journl/y2007v8i2p313-340.html
   My bibliography  Save this article

Institutions, market constellations and growth: The case of South Africa

Author

Listed:
  • Arne Heise

    (University of Hamburg Faculty of Economic and Social Sciences Department of Economics and Politics)

Abstract

Post-apartheid South Africa is facing three major economic problems: (1) slack economic growth, (2) high and growing unemployment and (3) among the world¡¯s highest income inequality and poverty indices. South Africa is currently caught in a macro-economic straight-jacket of tight monetary, restrictive fiscal and a wage policy stance that raises NAIRU. The persistence of a sub-optimal ¡®market constellation¡¯ is created by an institutional setting of a non-accommodative Reserve Bank, a sectoral-regional and company level noncoordinated collective bargaining system, an austere ¡®sound finance regime¡¯ of public budgeting and the lack of any institution to co-ordinate macro-economic policy. To tailor a better fitting constellation, a social contract involving major reforms in macro-economic governance in South Africa is proposed.

Suggested Citation

  • Arne Heise, 2007. "Institutions, market constellations and growth: The case of South Africa," Annals of Economics and Finance, Society for AEF, vol. 8(2), pages 313-340, November.
  • Handle: RePEc:cuf:journl:y:2007:v:8:i:2:p:313-340
    as

    Download full text from publisher

    File URL: http://www.aeconf.net/Articles/Nov2007/aef080205.pdf
    Download Restriction: no

    File URL: http://down.aefweb.net/AefArticles/aef080205.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Jeffrey Frankel & Ben Smit & Federico Sturzenegger, 2008. "South Africa: Macroeconomic challenges after a decade of success," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 16(4), pages 639-677, October.
    2. Aron, Janine, 2000. "Growth and Institutions: A Review of the Evidence," World Bank Research Observer, World Bank Group, vol. 15(1), pages 99-135, February.
    3. Robert Pollin & Gerald Epstein & James Heintz & Léonce Ndikumana, 2006. "An Employment-targeted Economic Programme for South Africa," Country Study 1, International Policy Centre for Inclusive Growth.
    4. Janine Aron & John Muellbauer, 2002. "Interest Rate Effects on Output: Evidence from a GDP Forecasting Model for South Africa," IMF Staff Papers, Palgrave Macmillan, vol. 49(Special i), pages 185-213.
    5. Arne Heise, 2006. "Market Constellations and Macroeconomic Policymaking: Institutional Impacts on Economic Performance," Intereconomics: Review of European Economic Policy, Springer;German National Library of Economics;Centre for European Policy Studies (CEPS), vol. 41(5), pages 272-281, September.
    6. Kevin S. Nell, 2000. "Is Low Inflation a Precondition for Faster Growth? The Case of South Africa," Studies in Economics 0011, School of Economics, University of Kent.
    7. Stephen P. Dunn, 2000. "Wither Post Keynesianism?," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 22(3), pages 343-364, March.
    8. Arne Heise, 2002. "Optimal Public Debts, Sustainable Deficits, and Budgetary Consolidation," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, pages 319-337.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Monetary Policy; Fiscal policy; Wage policy; Macro-economic coordination;

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cuf:journl:y:2007:v:8:i:2:p:313-340. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Qiang Gao). General contact details of provider: http://edirc.repec.org/data/emcufcn.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.