BibTex RIS Cite

SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS

Year 2016, Volume: 8 Issue: 1, 145 - 160, 01.06.2016

Abstract

South Africa has to address the challenges of slow economic growth, poverty, and inequality in the face of precarious macroeconomic imbalances—foreign capital funds deficits of savings to investment, of tax income to government spending, and of exports to imports. Just how susceptible is the South African economy to an external shock? This paper extends a ‘resilience indicator’ developed by Rojas- Suarez (2015) and applies it to the case of South Africa. Such an indicator was constructed for South Africa and the other BRICS economies. The values for the period 2000–2014 were compared, and it was found that South Africa has become less resilient to an external shock during this period than its BRICS partners. South Africa is, therefore, more vulnerable to an external shock than the other BRICS economies

References

  • Bean, C. (2003), “Asset prices, financial imbalances and monetary policy: are inflation targets enough?” BIS Working Papers No 140. Bank for International Settlements.
  • Boissay, F. (2011), “Financial imbalances and financial fragility.” Working Paper
  • Series No 1317. European Central Bank.
  • Borio, C. & Lowe, P. (2002), “Assessing the Risk of Banking Crises”, BIS Quarterly Review, pp.43-54.
  • Bracke, T., Bussière, M., Fidora, M. and Straub, R. (2010), “A framework for assessing global imbalances”, The World Economy, Vol. 2010, pp.1140-1174.
  • Caballero, R.J., Farhi, E. and Gourinchas, P. (2006), “An equilibrium model of
  • ‘global imbalances’ and low interest rates.” Recent Work. Center for International and Development Economics Research. Catão, L.A.V. and Milesi-Ferretti, G.M. (2013), “External liabilities and crises”,
  • Journal of International Economics, Vol. 94, pp.18-32. Edwards, S. (2002), Does the Current Account Matter? Preventing Currency
  • Crises in Emerging Markets, Chicago: University of Chicago Press. Frankel, J.A. and Rose, A.K. (1996), “Currency crashes in emerging markets: An empirical treatment”, Journal of International Economics, Vol. 41, pp.351-366.
  • Frankel, J.A. and Saravelos, G. (2010), “Are Leading Indicators of Financial
  • Crises Useful for Assessing Country Vulnerability? Evidence from the 2008-09
  • Global Crisis.” National Bureau of Economic Research Working Paper Series, No. 16047.
  • Gourinchas, P. and Obstfeld, M. (2012), “Stories of the Twentieth Century for the Twenty-First”, American Economic Journal: Macroeconomics, Vol. 4, pp.226-65.
  • Jordà, Ò., Schularick, M. and Taylor, A.M. (2011), “Financial crises, credit booms, and external imbalances: 140 years of lessons”, IMF Economic Review, Vol. 59, pp.340-378.
  • Kahn, G.A. (2010), “Taylor rule deviations and financial imbalances.” Economic
  • Review. Federal Reserve Bank of Kansas City. Llewellyn, D. (2006), “Global and financial imbalances and their resolution:
  • Implications for financial stability.” Macroeconomic Policy Challenges for South Africa Conference. South African Reserve Bank. Mendoza, E.G. and Terrones, M.E. (2008), “An Anatomy Of Credit Booms:
  • Evidence From Macro Aggregates And Micro Data.” National Bureau of Economic Research Working Paper Series, No. 14049.
  • Obstfeld, M. (2012), “Does the Current Account Still Matter?” National Bureau of Economic Research Working Paper Series, No. 17877.
  • Obstfeld, M. and Rogoff, K.S. (2005), “Global Current Account Imbalances and Exchange Rate Adjustments”, Brookings Papers on Economic Activity, Vol. 2005, pp.67-123.
  • Rojas-Suarez, L. (2015), “Emerging Market Macroeconomic Resilience to
  • External Shocks: Today versus Pre-Global Crisis.” Center for Global Development Essays [Online]. Available: http://www.cgdev.org/publication/ emerging-market-resilience-external-shocks-today-versus-pre-global-crisis. Smit, B., Grobler, C. and Nel, C. (2014), “Sudden stops and current account reversals: potential macroeconomic consequences for South Africa”, South
  • African Journal of Economics, Vol. 82, pp.616-627.
Year 2016, Volume: 8 Issue: 1, 145 - 160, 01.06.2016

Abstract

References

  • Bean, C. (2003), “Asset prices, financial imbalances and monetary policy: are inflation targets enough?” BIS Working Papers No 140. Bank for International Settlements.
  • Boissay, F. (2011), “Financial imbalances and financial fragility.” Working Paper
  • Series No 1317. European Central Bank.
  • Borio, C. & Lowe, P. (2002), “Assessing the Risk of Banking Crises”, BIS Quarterly Review, pp.43-54.
  • Bracke, T., Bussière, M., Fidora, M. and Straub, R. (2010), “A framework for assessing global imbalances”, The World Economy, Vol. 2010, pp.1140-1174.
  • Caballero, R.J., Farhi, E. and Gourinchas, P. (2006), “An equilibrium model of
  • ‘global imbalances’ and low interest rates.” Recent Work. Center for International and Development Economics Research. Catão, L.A.V. and Milesi-Ferretti, G.M. (2013), “External liabilities and crises”,
  • Journal of International Economics, Vol. 94, pp.18-32. Edwards, S. (2002), Does the Current Account Matter? Preventing Currency
  • Crises in Emerging Markets, Chicago: University of Chicago Press. Frankel, J.A. and Rose, A.K. (1996), “Currency crashes in emerging markets: An empirical treatment”, Journal of International Economics, Vol. 41, pp.351-366.
  • Frankel, J.A. and Saravelos, G. (2010), “Are Leading Indicators of Financial
  • Crises Useful for Assessing Country Vulnerability? Evidence from the 2008-09
  • Global Crisis.” National Bureau of Economic Research Working Paper Series, No. 16047.
  • Gourinchas, P. and Obstfeld, M. (2012), “Stories of the Twentieth Century for the Twenty-First”, American Economic Journal: Macroeconomics, Vol. 4, pp.226-65.
  • Jordà, Ò., Schularick, M. and Taylor, A.M. (2011), “Financial crises, credit booms, and external imbalances: 140 years of lessons”, IMF Economic Review, Vol. 59, pp.340-378.
  • Kahn, G.A. (2010), “Taylor rule deviations and financial imbalances.” Economic
  • Review. Federal Reserve Bank of Kansas City. Llewellyn, D. (2006), “Global and financial imbalances and their resolution:
  • Implications for financial stability.” Macroeconomic Policy Challenges for South Africa Conference. South African Reserve Bank. Mendoza, E.G. and Terrones, M.E. (2008), “An Anatomy Of Credit Booms:
  • Evidence From Macro Aggregates And Micro Data.” National Bureau of Economic Research Working Paper Series, No. 14049.
  • Obstfeld, M. (2012), “Does the Current Account Still Matter?” National Bureau of Economic Research Working Paper Series, No. 17877.
  • Obstfeld, M. and Rogoff, K.S. (2005), “Global Current Account Imbalances and Exchange Rate Adjustments”, Brookings Papers on Economic Activity, Vol. 2005, pp.67-123.
  • Rojas-Suarez, L. (2015), “Emerging Market Macroeconomic Resilience to
  • External Shocks: Today versus Pre-Global Crisis.” Center for Global Development Essays [Online]. Available: http://www.cgdev.org/publication/ emerging-market-resilience-external-shocks-today-versus-pre-global-crisis. Smit, B., Grobler, C. and Nel, C. (2014), “Sudden stops and current account reversals: potential macroeconomic consequences for South Africa”, South
  • African Journal of Economics, Vol. 82, pp.616-627.
There are 23 citations in total.

Details

Other ID JA53EV86CK
Journal Section Articles
Authors

Henry J. Cockeran This is me

Publication Date June 1, 2016
Published in Issue Year 2016 Volume: 8 Issue: 1

Cite

APA Cockeran, H. J. (2016). SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS. International Journal of Economics and Finance Studies, 8(1), 145-160.
AMA Cockeran HJ. SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS. IJEFS. June 2016;8(1):145-160.
Chicago Cockeran, Henry J. “SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS”. International Journal of Economics and Finance Studies 8, no. 1 (June 2016): 145-60.
EndNote Cockeran HJ (June 1, 2016) SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS. International Journal of Economics and Finance Studies 8 1 145–160.
IEEE H. J. Cockeran, “SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS”, IJEFS, vol. 8, no. 1, pp. 145–160, 2016.
ISNAD Cockeran, Henry J. “SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS”. International Journal of Economics and Finance Studies 8/1 (June 2016), 145-160.
JAMA Cockeran HJ. SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS. IJEFS. 2016;8:145–160.
MLA Cockeran, Henry J. “SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS”. International Journal of Economics and Finance Studies, vol. 8, no. 1, 2016, pp. 145-60.
Vancouver Cockeran HJ. SOUTH AFRICA’S MACROECONOMIC RESILIENCE TO EXTERNAL SHOCKS: A COMPARISON TO ITS BRICS PARTNERS. IJEFS. 2016;8(1):145-60.