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The myth of “neutrality” and the rhetoric of “stability”: macroeconomic policy in democratic South Africa

  • Isaacs, Gilad
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    This paper offers a comprehensive review of macroeconomic policy in democratic South Africa. It does so with two distinctive features. First, macroeconomic policy is analysed on four interlocking, and sometimes conflicting, levels: [1] policy as provided “on paper” in government plans and programmes; [2] the scholarship upon which policy is (purportedly) premised; [3] the rhetoric/ideology that surrounds policy and sometimes obscures its true nature and even intentions; and [4] policy as actually implemented in practice. Second, the manner in which macroeconomic policy has facilitated the restructuring of the South African economy is carefully examined. This runs contrary to the orthodox assertion that macroeconomic policy only plays a “neutral” and/or “stabilising” role. It is shown that the restructuring that has occurred has not reoriented the economy away from its traditional reliance on minerals and energy, mineral-related sectors and finance; rather it has consolidated this structure and corresponding dynamics, albeit with novel features. Macroeconomic policy has, thus, played a leading role in facilitating particular forms of restructuring that, rather than reorienting the economy towards the needs of the impoverished majority, have reinforced the pre-existing dominant sections of capital while incorporating a newly emerging black bourgeoisie.

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    File URL: http://mpra.ub.uni-muenchen.de/54426/1/MPRA_paper_54426.pdf
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    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 54426.

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    Date of creation: 13 Mar 2014
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    Handle: RePEc:pra:mprapa:54426
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    1. Janine Aron & John Muellbauer, 2007. "Review of Monetary Policy in South Africa since 1994," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 16(5), pages 705-744, November.
    2. Janine Aron & Greg Farrell & John Muellbauer & Peter Sinclair, 2014. "Exchange Rate Pass-through to Import Prices, and Monetary Policy in South Africa," Journal of Development Studies, Taylor & Francis Journals, vol. 50(1), pages 144-164, January.
    3. S Roberts, 2000. "Understanding the Effects of Trade Policy Reform: The Case of South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 68(4), pages 270-281, December.
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    6. Tatiana Lysenko & Geoff Barnard, 2011. "Strengthening the Macroeconomic Policy Framework in South Africa," OECD Economics Department Working Papers 847, OECD Publishing.
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    8. Frankel, Jeffrey & Smit, Ben & Sturzenegger, Federico, 2007. "South Africa: Macroeconomic Challenges after a Decade of Success," Working Paper Series rwp07-021, Harvard University, John F. Kennedy School of Government.
    9. Trevor Bell & Greg Farrell, 1997. "The minerals-energy complex and South African industrialisation," Development Southern Africa, Taylor & Francis Journals, vol. 14(4), pages 591-613.
    10. José Gabriel Palma, 2009. "The revenge of the market on the rentiers," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 829-869, July.
    11. Ben Fine & Zavareh Rustomjee, 1998. "Debate 1: Debating the South African minerals-energy complex: A response to Bell and Farrell," Development Southern Africa, Taylor & Francis Journals, vol. 15(4), pages 689-701.
    12. Trevor Bell, 1998. "Debate 2: The minerals-energy complex and South African industrialisation: A rejoinder," Development Southern Africa, Taylor & Francis Journals, vol. 15(4), pages 703-714.
    13. Giuseppe Fontana, 2009. "Whither New Consensus Macroeconomics? The Role of Government and Fiscal Policy in Modern Macroeconomics," Economics Working Paper Archive wp_563, Levy Economics Institute.
    14. Joseph E. Stiglitz, 2011. "Rethinking Macroeconomics: What Failed, And How To Repair It," Journal of the European Economic Association, European Economic Association, vol. 9(4), pages 591-645, 08.
    15. Neo Chabane & Simon Roberts & Andrea Goldstein, 2006. "The changing face and strategies of big business in South Africa: more than a decade of political democracy," Industrial and Corporate Change, Oxford University Press, vol. 15(3), pages 549-577, June.
    16. Andrew Kerr & Martin Wittenberg & Jairo Arrow, 2014. "Job Creation and Destruction in South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 82(1), pages 1-18, 03.
    17. repec:ldr:wpaper:92 is not listed on IDEAS
    18. Michie, Jonathan & Padayachee, Vishnu, 1998. "Three Years after Apartheid: Growth, Employment and Redistribution?," Cambridge Journal of Economics, Oxford University Press, vol. 22(5), pages 623-35, September.
    19. James Boyce & Léonce Ndikumana, 2008. "New Estimates of Capital Flight from Sub-Saharan African Countries: Linkages with External Borrowing and Policy Options," Working Papers wp166, Political Economy Research Institute, University of Massachusetts at Amherst.
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