E24

Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital

Real Exchange Rate Volatility and Employment Growth in South Africa: The Case of Manufacturing

This paper investigates the effect of exchange rate volatility on employment growth in South Africa, a country that is characterised by high rates of unemployment and relatively high exchange rate volatility. Employing the Autoregressive Distributed Lag (ARDL) cointegration method over the period 1995Q3 to 2015Q2 and using a variety of specifications, results show that real exchange rate volatility has a significant contractionary effect on manufacturing employment growth.

The Sectoral Employment Intensity of Growth in South Africa

Concerns have been expressed recently about the inability of the South African economy to provide adequate employment for the increasing number of job seekers. The rate of unemployment remains stubbornly high in spite of vastly improved macroeconomic fundamentals since the 1990s. This paper investigates how the sectoral employment intensity of output growth in the eight non-agricultural sectors of the South African economy has evolved in the period 2000:01-2012:04, with a view to identifying key growth sectors that are employment intensive.

Inflation, growth and employment in South Africa: Trends and trade-offs

It is often publicly contended that overly strict application of inflation targeting stifles employment growth in South Africa, with the Phillips curve often cited as seemingly authoritative reference. This paper revisits this debate and argues that the Phillips curve has often been misinterpreted and subsequently applied incorrectly. Furthermore, this paper investigates the effect of inflation on employment in South Africa via the effects of inflation on output. It aims to determine whether higher inflation could contribute to employment creation.

Wage Subsidy in the DRC: A CGE Analysis

This paper analyses wage subsidies on lower-skilled formal workers in the Democratic Republic of Congo (DRC). A multi-sectoral empirically-calibrated general equilibrium model capturing the economy-wide transactions between the formal and informal sectors is used to analyse one policy simulation in the DRC. The short and long run simulation in which the government provides wage subsidy to lower-skilled workers indicates that the government is able to significantly improve the deficiencies of the formal and informal households’ real disposable incomes.

Social capital as an engine of growth: Multisectoral modelling and implications

We propose a multisector endogenous growth model incorporating social capital. Social capital only serves as an input in the production of human capital and it involves a cost in terms of the final good. We show that in contrast to existing alternative specifications, this setting assures that social capital enhances productivity gains by playing the role of a timing belt driving the transmission and propagation of all productivity shocks throughout society whatever the sectoral origin of the shocks.

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