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Working Papers

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Optimal Monetary Policy with Output and Asset Price Volatility in an Open Economy: Evidence from Kenya

Peter Wamalwa
This paper attempts to establish optimal response of monetary policy to output, inflation and asset price volatility in a small open economy, taking into account optimisation behaviour of households and firms. The empirical analysis suggest that monetary policy responds to deviation of interest...
Feb 2018
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Disentangling the exchange rate risk, sectoral export flows and financial development nexus

Heinrich Nel and Anmar Pretorius
This paper examines the differential responses of various emerging market export sectors to exchange rate risk. This paper finds origin in initial theoretical posits of Ethier (1973) and Clark (1973) which both contend that exchange rate risk has a negative impact on the export flows of...
Feb 2018
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Financial Structure and Economic Growth: Evidence from Sub-Saharan Africa

Naomi Mathenge & Eftychia Nikolaidou
This study examines the effect of financial structure on economic growth in Sub Saharan Africa. The sample consists of both low and middle income countries, whose financial systems range from poorly developed to relatively well- developed in the context of developing countries. Using dynamic panel...
Feb 2018
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Electricity crisis and the effect of CO2 emissions on infrastructure-growth nexus in Sub Saharan Africa

Chengete Chakamera and Paul Alagidede
Sub Saharan Africa (SSA) has the greatest proportion of its population without access to electricity, especially those in rural communities. Efficiency of the power sector is another obstacle, characterised by rise in the ratio of electricity transmission and distribution (RETDL) and high levels of...
Feb 2018
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Credit frictions and co-movement of durable and non-durable goods in a small open economy

Hilary Patroba
In this paper I investigate, numerically, the co-movement puzzle by testing the ability of borrowing and lending constraints to counter the opposite movement of durable and non-durable goods in response to foreign monetary policy and international bond shocks. I do this by simulating a small open...
Feb 2018
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Regulatory ambiguity and policy uncertainty in South Africa’s telecommunications sector

Helanya Fourie, Lara Granville and Nicola Theron
The competitive effects of telecommunications transactions and the related impact that they have on economic growth and employment are influenced by the regulatory environment that governs the sector. In South Africa, the Independent Communications Authority of South Africa (ICASA) is responsible...
Jan 2018
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Nonlinearities in Financial Development–Economic Growth Nexus: Evidence from sub–Saharan Africa (SSA)

Muazu Ibrahim and Paul Alagidede
The impact of financial development on economic growth has received much attention in recent literature. However, there are potential discontinuities mediating finance–growth nexus that existing empirical studies have not rigorously examined. This study investigates whether the impact of finance on...
Jan 2018
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Pricing electricty blackout among South African households

Nomsa Phindile Nkosi and Johane Dikgang
South African households, like households in many other developing countries, are faced with regular power outages. This is a big problem, since the outages that the households experience are both frequent and long in duration. Efficient electricity infrastructure investment decisions are possible...
Jan 2018
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South African attitudes about nuclear power: The case of the nuclear energy expansion

Nomsa Phindile Nkosi and Johane Dikgang
The objective of our study is to investigate households’ attitudes and willingness to pay (WTP) for the proposed second nuclear power plant in South Africa. Traditional analysis of such data has tended to ignore zero WTP values. A spike model which explicitly accounts for zero WTP is employed. We...
Jan 2018
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Risk Preferences and the Poverty Trap: A Look at Technology Uptake amongst Smallholder Farmers in the Matzikama Municipality

Hafsah Jumare, Martine Visser and Kerri Brick
A number of studies suggest the risk preference of low income individuals can result in behaviour that create conditions of sub optimal investment and thus persistent poverty. In this paper, we carry out a study with small-scale farmers in the Matzikama Municipality of the Western Cape, South...
Jan 2018
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