VOLUME / UITGAWE 67
No. 1, March 1999
Nr. 1, Maart 1999
ABSTRACTS OF ARTICLES /
SAMEVATTING VAN ARTIKELS
Volume 67, No. 1, March 1999
Uitgawe 67, Nr. 1, Maart 1999
ON SOUTH
AFRICAN LABOUR POLICIES
F.S. BARKER
Current labour market policies in
South Africa are compared to the Government's Growth, Employment and Redistribution (GEAR)
strategy. Whereas GEAR strongly emphasises job creation, several current policies
have the opposite effect by increasing the direct and indirect cost of labour and by
reducing flexibility. Some examples are sectoral collective agreements that are
extended to all employers, legisaltion on minimum conditions of employment and on reducing
vertical wage differentials, increased opportunity costs of management, and policies which
conflict with the GEAR objective of wage moderation and have probably contributed to
unions causing a higher wage differential in South Africa than is generally the case in
other countries.
MONEY,
INTEREST RATES, INCOME AND INFLATION IN SOUTH AFRICA
P.G. MOLL
The practice of monetary targeting in
South Africa lacks a firm empirical basis, because reliable statistical links between
financial variables (monetary aggregates and interest rates) and nominal activity and
prices are not found in the data. But the central bank-determined discount rate, and
other interest rates, have leading indicator properties for real variable.
Institutional factors - the exogenity of the discount rate, and the endogeneity of the
monetary aggregates - can explain this pattern of empirical findings. The practice
of intermediate targeting using M3 was laregly redundant inasmuch as this variable did not
help predict any of the variables in question, and in any case the targets were missed
more often that not.
THE
CONCENTRATION PROFITS STALEMATE II:
Ideological rifts and methodological stress
F.C.v.N. FOURIE and A. SMITH
The concentration-profits debate is
in a stalemate. Although it appears that the controversy is about technical issues,
something more fundamental is at work. The debate is entangled by an interplay of
methodological and ideological differences. The methodological differences flow
ffrom (a) the search for universal, covering laws that govern economic variables, and (b)
the unresolved quest for the proper relationship between theory and facts in scientific
work. The ideological split relates to the innate optimality of the market and the
role of the state. Together these have plunged the debate in a binary fallacy, where
the observed concentration-profits relationship must be explained by either monopoly abuse
or superior efficiency. This predicament derives from the problem of causality.
THE FOREIGN
INDEBTEDNESS OF MODERATELY AND
SEVERELY-INDEBTED DEVELOPING COUNTRIES
P.C. AFXENTIOU and A. SERLETIS
A sample of 55 moderately and
severely-indebted developing countries, classified as low or middle-income, is examined
within the framework of bidirectional Granger causality to determine the relationship
between per capita income and foreign debt as represented by four measures of
indebtedness, namely debt to exports, per capita debt, per capita interest payments and
per capita total debt service. No causality was validated by our tests, a result
that suggests that the common weakness in the balance of payments of a highly
heterogeneous group of countries by and large ended up shaping rather uniformly their debt
policies, which were either domestically or externally imposed.
THE
AMALGAMATION MOVEMENT IN BANKING
IN SOUTH AFRICA, 1863 - 1920
F. STUART JONES
This article examines how and why the
world's most exclusive monopoly developed in South Africa in the early years of this
century and provided the country with a secure efficient banking system. It occurred
in two stages. In the first, London-based imperial banks absorbed all the local Cape
Colony banks; in the second, lasting from 1910 to 1920, two banks completed the process
for the rest of the country. Market forces determined the frist stage in the Cape.
Elsewhere politics and personal ambition joined forces in determining the outcome.
OKEAHALAM
AND BAH ON CORRUPTION: A COMMENT
SINCLAIR DAVIDSON
Generally economists would argue that
a negative relationship exists between corruption and Foreign Direct Investment.
This relationship provides a theoretical justification for the suppression of
corruption. In a recent issue of this journal, Okeahalam and Bah (1998) provide
evidence that shows no relationship between corruption and Foreign Direct Investment.
In this paper, we show that Okeahalam and Bah (1998) made some econometric errors
and that once these are accounted for, that the expected inverse relationship between
corruption and Foreing Direct Investment is supported by the data. |
