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MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA

Year 2016, Volume: 8 Issue: 2, 107 - 116, 01.12.2016

Abstract

The South African government has to address high rates of unemployment and whether the
provision of micro-credit finance can reduce unemployment. The study analysed the
relationship between micro-credit finance and unemployment using quarterly data covering
the period from 1994-2014. The study utilized the Vector Error Correction Model (VECM) to
provide short run and long run dynamic effects of micro-credit finance on unemployment.
The results indicated that micro-credit finance has a negative relationship with
unemployment. Therefore, it is recommended that microcredit finance can be used as a tool
to reduce unemployment and boost economic growth.

References

  • Nigeria”, Business and Management Review, Vol 2, No 1, pp. 27-51. Arvanits, Athanasios. (2002) “Foreign Direct Investment in South Africa”, (Selected Issues Paper, IMF Country Report No. 03/18) Washington: International Monetary Fund, pp. 75-83.
  • Blungmart, M. (2000) “The Augmented Dickey-Fuller test”, Journal of Econometrics, Vol , No 1, pp. 131-143.
  • Chowdhury, Alarm. (2009) “Micro-credit, micro-enterprises, and Self-employment of
  • Women: Experience from the Grameen Bank in Bangladesh”, Bangladesh: University of Dhaka. Dauda, Risikat. (2013) “Microfinance, Poverty and Employment Gender Gap: An Analysis from the Nigerian Perspective”, Nigeria: University of Lagos.
  • Duvendack, Maren, Palmer-Jones Richard, Copestake James, Hooper Lee, Loke Yoon and Rao Nitya. (2011) “What is the Evidence of the Impact of Microfinance on the Well-Being of
  • Poor People? London: EPPI-Centre, Social Science Research Unit, Institute of Education, University of London. Engle, Robert. (1984). Wald, Likelihood Ratio and Lagrange Multiplier tests in
  • Econometrics: in Handbook of Econometrics, North Holland, Volume II pp. 775-1461,
  • Edited by Elsevier Science Publishers BV. Engle, Robert and Granger, Clive. (1987) “Co-integration and Error Correction:
  • Representation, Estimation and Testing”, Econometrica, Vol 55, No 2, pp. 251–276. ESAF (2004), East and Southern African Banking Supervisors Group, http://www.esaf.org/esaf/esafv2.nsf/Print/C9337EFBDF269D1A42256E2A003DED42/?open document:micro [Accessed 21.08. 2015].
  • Frye, Isobel. (2006) “Poverty and Unemployment in South Africa”, National Labour and Economic Development Instutute.
  • Gujarati, Damoda. (2004) Basic Econometrics, New York, Springer.
  • Javed Asif, Luqmani Muhammad, Khan Ahmeed and Farah Abdirehman. (2006) “Impact of
  • Micro-Credit Scheme of NRSP on the Socio-Economic Conditions of Female Community in District Rawalakot, Pakistan”, Journal of Agriculture & Social Sciences, Vol 2, No 3, pp. 144. Kyei Kwabena and Gyekye Kwame. (2011) “Determinants of Unemployment in Limpopo
  • Province in South Africa: Exploratory Studies”, Journal of Emerging trends in Economics and Management sciences, Vol 2, No 1, pp. 54-61. Latif Abdul, Nazar Muhammad, Mehmood Tariq, Shaikh Muhammad and Shaikh Ali. (2011)
  • “Sustainability of Micro Credit System in Pakistan and its Impact on Poverty Alleviation”, Journal of Sustainable Development, Vol 4, No 4, pp. 160-165. Maddala, G. and Kim In-Moo. (1998) Unit Roots, Cointegration and Structural Change.
  • Cambridge, UK: Cambridge University Press. Mamun Abdullah, Wahab Abdul and Malarvizhi C. (2011) “Examining the Effect of Micro- credit on Employment in Peninsular Malaysia”, Journal of Sustainable Development, Vol 4, No 2 pp. 174-183.
  • McCulloch, Huston. (1985) “Miscellanea: On Heteroscedasticity”, Econometrica, Vol 53, No 2, pp. 483 Micro:World.org (2010), microworld/about-microcredit [Accessed: 20.04.2015] About Microcredit, http://www.microworld.org/en/about
  • Mondal, Wali. (2009) “Poverty Alleviation and Micro-credit”, International Business &
  • Economics, Vol 8, No 1, pp. 1-10. Ndife, Chinelo. (2013) “The Impact of Micro Credit Institutions on the Development of
  • Small and Medium Enterprises in Anambra State”, Business and Management, Vol 14, No 5, pp. 75-81. Nkosi, Bongani. http://www.southafrica.info/business/economy/jobs-010812.htm#.VdOz7sH8Jay [Accessed: 08. 2015]. (2015).
  • South Africa's Unemployment Rate Drops, Okon D., Etim N. and Offiong A. (2012) “Impact of Micro Credit Scheme on Rural Farmers in Akwa Ibom State, Nigeria”, Journal of Agriculture & Social Sciences, Vol 8, No 2.
  • Phillips, Peter and Perron, Pierre. (1988) “Testing for a Unit Root in Time Series
  • Regression”, Biometrika, Vol 75, No 2, pp. 335–346 Roodman, David. (2013). A Milestone in the Great Debate Over a Microcredit Impact Study, http://www.financialaccess.org/blog/2013/10/milestone-great-debate-over-microcredit- impact-study, [Accessed: 29. 05. 2015].
  • Sims, Christopher. (1980) “Macroeconomics and Reality”, Econometrica. Vol 48, pp.1-48.
  • Stanila, Larisa, Andreica, Madalina and Cristescu, Amalia. (2013) “Econometric Analysis of the Employment Rate for the E.U. Countries. 2nd World conference on Business, Economics and Management, Vol 6, No 8, pp. 178-182.
  • Theobald, Stuart. (2012). The Risk of Unsecured lending in South Africa, http://www.leriba.com/insights/reports/unsecured-lending-in-south-africa/ [Accessed 28. 08.
Year 2016, Volume: 8 Issue: 2, 107 - 116, 01.12.2016

Abstract

References

  • Nigeria”, Business and Management Review, Vol 2, No 1, pp. 27-51. Arvanits, Athanasios. (2002) “Foreign Direct Investment in South Africa”, (Selected Issues Paper, IMF Country Report No. 03/18) Washington: International Monetary Fund, pp. 75-83.
  • Blungmart, M. (2000) “The Augmented Dickey-Fuller test”, Journal of Econometrics, Vol , No 1, pp. 131-143.
  • Chowdhury, Alarm. (2009) “Micro-credit, micro-enterprises, and Self-employment of
  • Women: Experience from the Grameen Bank in Bangladesh”, Bangladesh: University of Dhaka. Dauda, Risikat. (2013) “Microfinance, Poverty and Employment Gender Gap: An Analysis from the Nigerian Perspective”, Nigeria: University of Lagos.
  • Duvendack, Maren, Palmer-Jones Richard, Copestake James, Hooper Lee, Loke Yoon and Rao Nitya. (2011) “What is the Evidence of the Impact of Microfinance on the Well-Being of
  • Poor People? London: EPPI-Centre, Social Science Research Unit, Institute of Education, University of London. Engle, Robert. (1984). Wald, Likelihood Ratio and Lagrange Multiplier tests in
  • Econometrics: in Handbook of Econometrics, North Holland, Volume II pp. 775-1461,
  • Edited by Elsevier Science Publishers BV. Engle, Robert and Granger, Clive. (1987) “Co-integration and Error Correction:
  • Representation, Estimation and Testing”, Econometrica, Vol 55, No 2, pp. 251–276. ESAF (2004), East and Southern African Banking Supervisors Group, http://www.esaf.org/esaf/esafv2.nsf/Print/C9337EFBDF269D1A42256E2A003DED42/?open document:micro [Accessed 21.08. 2015].
  • Frye, Isobel. (2006) “Poverty and Unemployment in South Africa”, National Labour and Economic Development Instutute.
  • Gujarati, Damoda. (2004) Basic Econometrics, New York, Springer.
  • Javed Asif, Luqmani Muhammad, Khan Ahmeed and Farah Abdirehman. (2006) “Impact of
  • Micro-Credit Scheme of NRSP on the Socio-Economic Conditions of Female Community in District Rawalakot, Pakistan”, Journal of Agriculture & Social Sciences, Vol 2, No 3, pp. 144. Kyei Kwabena and Gyekye Kwame. (2011) “Determinants of Unemployment in Limpopo
  • Province in South Africa: Exploratory Studies”, Journal of Emerging trends in Economics and Management sciences, Vol 2, No 1, pp. 54-61. Latif Abdul, Nazar Muhammad, Mehmood Tariq, Shaikh Muhammad and Shaikh Ali. (2011)
  • “Sustainability of Micro Credit System in Pakistan and its Impact on Poverty Alleviation”, Journal of Sustainable Development, Vol 4, No 4, pp. 160-165. Maddala, G. and Kim In-Moo. (1998) Unit Roots, Cointegration and Structural Change.
  • Cambridge, UK: Cambridge University Press. Mamun Abdullah, Wahab Abdul and Malarvizhi C. (2011) “Examining the Effect of Micro- credit on Employment in Peninsular Malaysia”, Journal of Sustainable Development, Vol 4, No 2 pp. 174-183.
  • McCulloch, Huston. (1985) “Miscellanea: On Heteroscedasticity”, Econometrica, Vol 53, No 2, pp. 483 Micro:World.org (2010), microworld/about-microcredit [Accessed: 20.04.2015] About Microcredit, http://www.microworld.org/en/about
  • Mondal, Wali. (2009) “Poverty Alleviation and Micro-credit”, International Business &
  • Economics, Vol 8, No 1, pp. 1-10. Ndife, Chinelo. (2013) “The Impact of Micro Credit Institutions on the Development of
  • Small and Medium Enterprises in Anambra State”, Business and Management, Vol 14, No 5, pp. 75-81. Nkosi, Bongani. http://www.southafrica.info/business/economy/jobs-010812.htm#.VdOz7sH8Jay [Accessed: 08. 2015]. (2015).
  • South Africa's Unemployment Rate Drops, Okon D., Etim N. and Offiong A. (2012) “Impact of Micro Credit Scheme on Rural Farmers in Akwa Ibom State, Nigeria”, Journal of Agriculture & Social Sciences, Vol 8, No 2.
  • Phillips, Peter and Perron, Pierre. (1988) “Testing for a Unit Root in Time Series
  • Regression”, Biometrika, Vol 75, No 2, pp. 335–346 Roodman, David. (2013). A Milestone in the Great Debate Over a Microcredit Impact Study, http://www.financialaccess.org/blog/2013/10/milestone-great-debate-over-microcredit- impact-study, [Accessed: 29. 05. 2015].
  • Sims, Christopher. (1980) “Macroeconomics and Reality”, Econometrica. Vol 48, pp.1-48.
  • Stanila, Larisa, Andreica, Madalina and Cristescu, Amalia. (2013) “Econometric Analysis of the Employment Rate for the E.U. Countries. 2nd World conference on Business, Economics and Management, Vol 6, No 8, pp. 178-182.
  • Theobald, Stuart. (2012). The Risk of Unsecured lending in South Africa, http://www.leriba.com/insights/reports/unsecured-lending-in-south-africa/ [Accessed 28. 08.
There are 26 citations in total.

Details

Other ID JA72SZ45UJ
Journal Section Articles
Authors

T. Ncanywa This is me

S. Getye This is me

Publication Date December 1, 2016
Published in Issue Year 2016 Volume: 8 Issue: 2

Cite

APA Ncanywa, T., & Getye, S. (2016). MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA. International Journal of Economics and Finance Studies, 8(2), 107-116.
AMA Ncanywa T, Getye S. MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA. IJEFS. December 2016;8(2):107-116.
Chicago Ncanywa, T., and S. Getye. “MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA”. International Journal of Economics and Finance Studies 8, no. 2 (December 2016): 107-16.
EndNote Ncanywa T, Getye S (December 1, 2016) MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA. International Journal of Economics and Finance Studies 8 2 107–116.
IEEE T. Ncanywa and S. Getye, “MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA”, IJEFS, vol. 8, no. 2, pp. 107–116, 2016.
ISNAD Ncanywa, T. - Getye, S. “MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA”. International Journal of Economics and Finance Studies 8/2 (December 2016), 107-116.
JAMA Ncanywa T, Getye S. MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA. IJEFS. 2016;8:107–116.
MLA Ncanywa, T. and S. Getye. “MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA”. International Journal of Economics and Finance Studies, vol. 8, no. 2, 2016, pp. 107-16.
Vancouver Ncanywa T, Getye S. MICRO-CREDIT FINANCE AND UNEMPLOYMENT IN SOUTH AFRICA. IJEFS. 2016;8(2):107-16.