David Fryer

Both the loss of prestige caused to mainstream economics by the global financial crisis and the resurgence of heterodox economics have proved to be superficial. ‘Where it counts’ (in the teaching of economics, in the most important policy circles, and in the most prestigious journals) neoliberal economics has proven resilient to dissent. Political dissent at South Africa’s self-imposed structural adjustment programme peaked in 2007 at the ANC’s elective conference and has subsequently lost impetus. Heterodox economics, although providing a more compelling account of the post-apartheid period, has for the most part been unable to penetrate the neoliberal bubble. This state of affairs is partly due to power relations, but it is also a function of the kind of economics that is regarded in the profession as ‘state of the art’.

This article examines the potential role the BRICS Contingent Reserve Arrangement (CRA) could play in stabilising countries experiencing a high degree of economic volatility. The CRA is a US$100 billion pooled reserve fund that has its origins in the fifth BRICS Summit hosted in Durban. The CRA was set up to help emerging nations deal with liquidity shortages and to strengthen financial systems during crisis. The article examines the debate on the effect of capital market liberalisation and collates some relevant macroeconomic data on the BRICS economies in order to explore the case for a contingent reserve facility. It is found that emerging economies that rapidly liberalised their capital accounts experienced increased economic volatility, creating an uncertain macroeconomic environment and hampering the ability of policymakers to conduct appropriate stabilisation policy. The article takes the position that the CRA could play an important role in providing liquidity to distressed emerging economies. However it concludes that the CRA facility does not signal a significant break from the Bretton Woods institutions on the part of the BRICS countries.

Working Paper 03/76 ISBN 0-7992-2187-2 We develop a model where blacks in the private sector earn no returns to education if there are relatively too few educated blacks. Using a sample of black females in the late apartheid Kwa Zulu to control for labour market specific effects, we find that more than a fifth of labour market participants are self-employed. There are no returns to primary education and positive returns for the first two years of secondary education. Further education allows females to find employment in the government sector where they earn a wage premium. Only secondary education is a predictor of earnings status, and new migrants are most likely to be unemployed. Our analysis therefore contributes to challenging the consensus on high returns to primary education in developing countries. JEL Classification: D45, L10

There is significant consensus that unemployment and more generally, exclusion from the labour market, is the central socio-economic problem in South Africa. Joblessness is strongly implicated in such socio-economic problems as crime, poverty, alcoholism, HIV-

Lynch (2012: 154) compellingly argues that there are “lessons that South Africa can learn (and has not learnt) from post-independence histories of other African states, and the lessons that other countries can in turn learn (and are not learning) from the continent’s political and economic powerhouse”. This juxtaposition (South Africa/‘Africa’) is particularly pertinent in the case of extractive industries. Firstly arguments about this sector have long played a prominent role in the broader debate about the determinants of economic development. The growth acceleration of sub-Saharan Africa since the mid1990s, with some signs of improvement in income distribution and social indicators, led to optimism that ‘this time’ the region would ‘genuinely’ develop. In this ideological environment, arguments questioning the sustainability of growth paths so heavily dependent on commodity exports and financialisation, although compelling, tended to have little policy impact (Arbache and Page, 20...

The expansion of credit rating agencies into emerging markets is examined with respect to the overall quality of informational signals provided by ratings to capital markets. Corporate ratings from six developing economies with relatively sophisticated financial sectors are modeled using ordered probit estimation techniques. The paper finds that the informational content in emergingmarket corporate credit ratings is poor ipso facto and compared to similar models of developed market ratings, and suggests that the sample countries are subject to what is termed an ‘emerging market premium’. The consequences of this hypothesis for applications in development finance and regulatory regimes are briefly considered. Procyclicality is not found to be a problem, but this is attributed to clustering rather than through-the-cycle design. It is concluded that corporate credit ratings currently do not actively enhance efficient financial intermediation in developing financial markets and are not ...

Table 1: Summary of Changes in SACU's Trade with SADC and the Rest of the World, 1994-2000 (Constant 1995 Rmns) Table 2: Major Sectors with Increasing Intra-Industry Trade, in Descending Order of Importance Table 3: Analysis of Changes in SACU's Trade ...

Abstract: For a long time, there was a consensus that returns to primary education are high across all developing countries (Psacharo-poulos and Patrinos, 2002). However, recent evidence is starting to point to the contrary in much of sub-Saharan Africa. We contribute to this ...

This paper addresses the issue of conceptual ambiguity and how it relates to labour market data, with a particular focus on informality.  Although a ‘basic portrait’ of the South African labour market has emerged, empirical uncertainty remains a key source of obscurity in a range of economic debates.  In particular, debates about informality (which is often conflated with flexibility) and the appropriate degree and nature of regulation remain as polarized as they were in the early 1990s.  Answering specific questions about the ‘informal sector’ (appropriate policies to support SMEs, the question of microfinance, the issue of skills development) is hardly possible in this context.  The paper argues that resolving this impasse depends not on more data but on better conceptualization of the labour market.  This in turn depends on an understanding of context, that is, South Africa’s socio-economic and political structure and its global articulation.