Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/27090
Authors: 
Heise, Arne
Year of Publication: 
2007
Series/Report no.: 
Arbeitspapiere für Staatswissenschaft 22
Abstract: 
Post-apartheid South Africa is facing three major economic problems: (1) slack economic growth, (2) high and growing unemployment and (3) among the world's highest income inequality and poverty indices. South Africa is currently caught in a macro-economic straight-jacket of tight monetary, restrictive fiscal and a wage policy stance that raises NAIRU. The persistence of a sub-optimal 'market constellation' is created by an institutional setting of a non-accommodative Reserve Bank, a sectoral-regional and company level noncoordinated collective bargaining system, an austere 'sound finance regime' of public budgeting and the lack of any institution to co-ordinate macro-economic policy. To tailor a better fitting constellation, a social contract involving major reforms in macro-economic governance in South Africa is proposed.
Subjects: 
Monetary Policy
fiscal policy
wage policy
macro-economic co-ordination
JEL: 
E12
E24
E6
O1
O23
Document Type: 
Working Paper

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