Financial development and economic growth in South Africa
- Authors: Mhango, Joseph
- Date: 2019
- Subjects: Finance -- South Africa , Economic development -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: http://hdl.handle.net/10948/41117 , vital:36358
- Description: Since the identification of financial development for economic growth by Schumpeter (1911), the importance of financial development has been emphasised. However, the nature of the relationship is unclear, whether financial development is demand-following, supply-leading, feedback relationship or no causal relationship with economic growth. The revolution of the relationship between finance and economic growth has left a void of the exact nature of the relationship and importance of financial development in literature and empirical evidence. In addition, the variation of the nexus between financial development and economic growth in developed and developing countries has left policy makers uncertain on the exact policy to employ. In awe of this, after the discovery of diamonds and gold in South Africa, policy makers have attempted to improve the access, depth and efficiency of the finance sector to spur economic growth. However, South Africa has been subject to apartheid, low economic growth, global financial crises, international sanctions, unemployment and other challenges to the finance sector. In light of this, this study aims to empirically investigate the relationship between financial development and economic growth in South Africa. The study used the recently developed financial institutions index and financial markets index by the International Monetary Fund to represent bank-based and market-based financial development. This study utilises annual data over the period 1980 to 2014. The study applied the Autoregressive Disturbed Lag (ARDL) bounds testing, Vector Error Correction Model (VECM) Granger – Causality, Impulse Response Function (IRF) and Variance Decomposition to uncover the relationship between financial development and economic growth in South Africa. The ARDL was selected over the Johansen Cointegration because the variables can be I (1) or I(0) before carrying out the bounds testing. It is more suitable to a small sample size. It uses a reduced form equation, and it provides unbiased estimates of the long-run model. Lastly, it can be transformed into an error correction model. The VECM Granger-Causality was chosen because it represents the short-run and long-run causalities. After selection of the optimal lag, the ARDL bounds testing shows that economic growth, bank-based financial development, market-based financial development, savings and investment have a long-run relationship in South Africa. However, after estimation of the coefficients, financial development has a positive relationship with economic growth, but insignificant and only savings and investment were significant in determining long-run economic growth. The VECM granger-causality results show that financial development (bank and market), savings and investment granger cause economic growth in the long-run. While, economic growth, market-based financial development, savings and investment granger cause bank-based financial development in the long-run. Therefore, a feedback relationship exists between bank-based financial development and economic growth in the long-run. In the short-run, it was clear that bank-based financial development positively causes economic growth. The causality results show that a feedback relationship exists between bank-based financial development and economic growth in South Africa in the short-run as well. The IRF shows that a shock in economic growth negatively and positively affects bank based and market-based financial development respectively. A shock in bank-based financial development causes a positive effect on economic growth. Lastly, a shock in market-based financial development causes a positive effect on economic growth. Whilst, the variance decomposition shows that fluctuations in economic growth are increasingly explained by financial development (bank and market). While, fluctuations in bank-based financial development are increasingly explained by market-based financial development, savings and investment. The fluctuations in market-based financial development are increasingly caused by economic growth, savings and investment. It is recommended that policy makers utilise bank-based financial development for economic growth and reduced unemployment, to increase savings for long-run economic growth. Furthermore, challenges against market-based financial development should be reduced in order to create a positive relationship between investment and economic growth in the long run.
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- Date Issued: 2019
Trading with selected SADC countries and economic growth in South Africa
- Authors: Malimba, Nwabisa
- Date: 2018
- Subjects: Southern African Development Community , Economic development -- South Africa South Africa -- Economic conditions -- 1991 Economic development -- Africa, Southern
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: http://hdl.handle.net/10948/31962 , vital:31867
- Description: This study empirically evaluates the impact of trading with SADC countries on the economic growth of South Africa (2010 -2016). The study used Fixed Effects Model to determine the relationship between economic growth of South Africa and the selected explanatory variables. The study made use of annual panel data from World Bank, Focus Economics and Trading economics. The relationship between South Africa’s economic growth and its determinants was examined using the procedure suggested in the literature by William (2017). Various tests were conducted to ensure that the relevant model is used and to produce reliable results. The results of a fixed effects model revealed that exports, imports and trade openness are statistically significant for South African economic growth. However, the p-values indicated that trade openness is the most statistically significant variable in explaining the variation in South African economic growth better than other explanatory variables confirm. Other variables that explained the fitness of the model for the data indicated that the model was a good fit. The implication of the results obtained from Fixed Effects model is that there was little trade between South Africa and selected SADC countries during the period under review. Trading with SADC countries has a negative effect on South African economy mainly because there was a decrease in exports to SADC over the past six years and that SADC countries still need to be more open to trade. Less intensive trading between SADC countries could be attributed to shortage of capital, infrastructure and skilled labour among SADC countries. The main trading partners of South Africa are countries that are characterised by being capital intensive and have highly skilled labour. In the light of the challenges that negatively affects trade in the SADC region, the study suggests that SADC should spell out the criteria that countries need to meet before they can become members of the union. These should be non-negotiable and ensure that member states harmonise their policies with those of SADC. The study also suggests that SADC countries should be more open to trade as it has been empirically proven that trade openness has a positive relationship with economic growth. Empirical evidence presents that countries with open, large and more developed neighbouring economies grow faster than those with closed, smaller, and less developed neighbouring economies. Trade should be intensified because there are potential gains to trading with SADC. It is further suggested that more focus should be given on work related training to improve the skills of our labour force. These suggestions are based on the belief that African countries have the ability to rescue themselves out of the vicious cycle of poverty.
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- Date Issued: 2018
Parents' perceptions of discipline with young children
- Authors: Van der Walt, Bianca Anne
- Date: 2015
- Subjects: Discipline of children , Child rearing
- Language: English
- Type: Thesis , Masters , MA
- Identifier: http://hdl.handle.net/10948/4023 , vital:20505
- Description: Little research is available in South Africa regarding discipline with young children in families. In order to understand the various influences acting upon discipline within a family, it is important to understand the influences acting upon the family system. The current research proposes to understand parents’ perceptions of disciplining children in the age range of 2 to 5 years, the methods they use and the factors they perceive as influencing their methods of discipline. The proposed study will make use of Bronfenbrenner’s Ecosystemic Theory of Human Development as the guiding theoretical framework in exploring and describing this research area. The study will use semi-structured interviews with parents to obtain qualitative data. The data obtained from the participants will be analysed by using content analysis.
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- Date Issued: 2015