Journal of Development Perspectives - latest Issue
Volume 4, Issue 1, 2008
Introduction: special issue on data questions related to industry and manufacturing sector studies in South AfricaAuthor Johannes FedderkeSource: Journal of Development Perspectives 4 (2008)More Less
Author Francis TealSource: Journal of Development Perspectives 4, pp 1 –31 (2008)More Less
In this paper a range of issues are addressed as to how firm level surveys can inform policies to reduce poverty. In understanding how policy impacts on poverty it is necessary to understand the factors that determine the price and demand for labour of varying skills. Three factors matter - the productivity of the firm, its size and the skill composition of the workforce. Each of these factors is examined in this paper drawing on comparative evidence for manufacturing firms in Afi-ica. An overview of the data that has been collected under firm surveys is provided. It is argued that understanding why firms are not creating nearly enough jobs for unskilled workers is the central current problem in development policy in Africa. Firm surveys show the nature of the policy dilemma. Small firms are good at producing jobs per unit of investment but the amount of investment is so low that such job creation is far below the rate of growth of the labour force. Further, as job creation is concentrated in self-employment and the small firm sector, such jobs are low paid relatively to those in the large scale and public sectors.
Trade-related business climate and manufacturing export performance in Africa: a firm-level analysisSource: Journal of Development Perspectives 4, pp 32 –66 (2008)More Less
Africa continues to be marginalised in world trade of manufactured goods, despite reductions in tariffs and non-tariff barriers. This paper investigates whether high business and trade costs associated with Africa's trade-related infrastructure, trade institutions and the regulatory environment have contributed towards its mediocre trade performance. The paper focuses on eight African countries - Egypt, Kenya, Madagascar, Mauritius, Morocco, South Africa, Tanzania and Zambia - using the World Bank's investment climate surveys. The results of the study suggest that the business climate, as measured using principal components for micro-level supply constraints, macroeconomic conditions and the legal environment, is closely associated with firm-level export propensity. Improvements in domestic policy may therefore have a considerable positive impact on manufacturing export performance in Africa.
Source: Journal of Development Perspectives 4, pp 67 –92 (2008)More Less
Policies to stimulate export growth and diversily the composition of exports in South Africa are now high on the government's agenda. In order to understand exporting and its impact on j ob creation, one needs to understand how firms function, what determines, or constrains, exporting at the firm level and the links between export behaviour and labour demand. An understanding of these relationships, particularly over time, is also essential for the implementation and evaluation of export related policies. This paper reviews the evidence on South African exporting firms, highlighting what we know, and what we do not know. A key conclusion is that our understanding of firm level export behaviour is severely constrained by the lack of adequate firm data, particularly panel data.
Source: Journal of Development Perspectives 4, pp 93 –118 (2008)More Less
Inflation, a macroeconomic variable, is underpinned by microeconomic data. This paper uses a large microdata sample at the unit level of South Africa's Consumer Price Index (CPI) for the eriod 2001ml2 to 2007ml2 to begin to understand price setting conduct in South Africa. An understanding of price setting conduct is important since macroeconomic models, used for monetary policy, often incorporate estimates of pricing conduct. Often these estimates are not based on rigorous analysis of the underlying data. The dataset used in this paper allows for the following to be calculated: the frequency of price changes, the frequency of price increases and price decreases, findings on the magnitude of price changes, price increases and price decreases, and findings on the duration of prices, and thus provides a more accurate estimate on pricing conduct than has been previously available for South Africa. Results are presented at both an aggregate and a disaggregated level, based on the CPI's major product categories and show the heterogeneous nature of price changes within the South African economy. These South African results are compared briefly to the results for other countries, where such micro level price data analysis has been undertaken. The study is part of a broader research effort into the implications of price setting conduct for monetary policy in South Africa, including an analysis of time- and state-dependent factors influencing the frequency and magnitude of price changes.
Author Rashad CassimSource: Journal of Development Perspectives 4, pp 119 –133 (2008)More Less
South Africa has a well developed culture of economic policy research, particularly in the post apartheid era. The relevance and quality of this research has, however, been highly dependent on the quality and availability of official statistics. There has been considerable criticism, especially from the academic community, of the extent and consistency of official data. Particular concerns have related to time series inconsistency, lack of access to unit record data (at the level of the firm or enterprise), and omissions in important data formerly available, for example, through the economic censuses. In view of these concerns this paper provides a short history of the evolution of firm based statistics in South Africa from the time of economic census to the current practice of sampling. It also provides an explanation of what determines the priorities of official statistical collection. The thrust of the paper is to convey to users of data what is currently collected and why. The paper ends with an open challenge to the academic community on the grounds that despite limitations of data, a great deal of what is available is under-exploited.
Source: Journal of Development Perspectives 4, pp 134 –189 (2008)More Less
This paper surveys the literature on the manufacturing sector in South Africa, focusing on concentration and markup levels, with a view to inform policy. The literature has employed a number of different measures of industrial concentration, namely, the Gini and Rosenbluth indices, the Occupancy Count, the C5% index and to a lesser extent. Concentration Ratios and the Herfmdahl-Hirschman index. Generally, manufacturing industry concentration is found to be high and increasing up to 1996. However, all the measures show decreasing concentration post 1996. In respect of markups, the evidence suggests that markups in South Africa are significantly higher than they are in comparable industries world-wide and they appear to be non-declining. However, there are dissenting voices on this point. We then juxtapose the concentration and price-cost margins findings to industry performance (at the macro level). In particular, we review the literature that examines the relations between concentration and price-cost margins on the one hand and output growth, productivity growth, employment, employment growth, investment and export and import competitiveness on the other. We then draw implications for competition policy in South Africa, pointing out areas that need further research as well as international best practices.