Public economics and modelling (PEM)

Afreekonomics

Articles for Public economics and modelling (PEM)

Financial market update

Posted: 06-Jun-2022

Zaakirah Ismail (5 Min Read)

Unsupportive global conditions are expected to result in a moderately weaker rand during the remainder of this year. We foresee the rand breachingR16 to the dollar and trading closer to R16 to the dollar for most of the year.

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The Gender-Wage Gap in South Africa (Blog 2 of 2)

Posted: 17-Mar-2022

Michele Capazario and Bianca Capazario (9 min read)

In a previous blog, we discussed unconditional wage gaps in South Africa. As a refresher, an unconditional wage gap is simply the difference in average or median wages between demographic groups (say, for example, the gap between females and males), not controlling for factors that influence wages, like experience or education. As a reminder, unconditional estimates suggest that men earned approximately 36% more than females according to the 2019 Labour Market Dynamics Survey (LMDS)...

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What lies behind the recent rand strength

Posted: 07-Jun-2021

Zaakirah Ismail (3 Min Read)

Vulnerabilities prior to Covid19 meant that investor sentiment around South Africa (SA) was particularly fragile. The severity of the pandemic itself, further eroded investor sentiment, thereby weakening the rand and increasing market volatility. During this time, we saw the USDZAR trading at over R19/$. In recent weeks, however, the rand has gained substantial strength, and is now trading below R14/$. In this blog, we explore some of the reasons for the rands remarkable recovery. These include: 1) Dollar weakness on the back of global markets balancing US fiscal and monetary policy. 2) High real interest rates offered in SA, which continue to attract offshore investments and capital. 3) A historic current account surplus on the back of strong commodity prices; and 4) Stronger-than-expected tax revenue data easing growth concerns. With global risks such as rising US inflation at bay for now, the rand may continue to benefit. The rand may also find support from a continued commodities upswing which is supportive of the trade balance and growth. However, local risks remain. SA’s economic growth is still a source of concern for investors. SA still faces serious fiscal challenges, including large government debt and tricky negotiations around the public sector wage bill. Adding to this, the slow start to the COVID19 vaccination programme and the threat of a third Covid-19 wave could add downward pressure to overall investor sentiment. These real economy risks may limit future rand strength.Read Article

How does Rural-Urban Migration Influence Subjective Physical Health Outcomes?

Posted: 18-Mar-2021

Bianca Capazario

DuringApartheid, black South Africans were not allowed to permanently relocate to urban areas, but instead were forced to retain ties to rural ‘homelands’. These ties led to the development ofoscillatingorcirculartrends of rural-urban migration. Today, these patterns of oscillating migration are still highly prevalent. While rural-urban migration is often associated with improved access to healthcare, living standards, education levels, and favourable employment opportunities, the migration process may also present new physical health risks. These risks may be introduced through the failure to attain either urban employment or adequate housing.The following blog reflects on the impact of rural-urban migration on the physical health of the sampled South African migrant group.Read Article