TY - JOUR AU - Baloi, Elizabeth AU - Dagume, Albert Mbulaheni PY - 2022/11/23 Y2 - 2024/03/29 TI - Macroeconomic Determinants of Economic Growth in South Africa (1994-2016): Cointegration Approach JF - International Journal of Economics and Financial Issues JA - IJEFI VL - 12 IS - 6 SE - Articles DO - 10.32479/ijefi.13626 UR - https://econjournals.com/index.php/ijefi/article/view/13626 SP - 75-85 AB - <p class="s8"><span class="s7"><span class="bumpedFont15">The key macroeconomic objectives being pursued by any developing country </span></span><span class="s7"><span class="bumpedFont15">are</span></span><span class="s7"><span class="bumpedFont15"> low </span></span><span class="s7"><span class="bumpedFont15">unemployment</span></span><span class="s7"><span class="bumpedFont15">,</span></span><span class="s7"><span class="bumpedFont15"> low </span></span><span class="s7"><span class="bumpedFont15">inflation</span></span><span class="s7"><span class="bumpedFont15">,</span></span><span class="s7"><span class="bumpedFont15"> and sustainable growth.</span></span><span class="s7"><span class="bumpedFont15"> The</span></span><span class="s7"><span class="bumpedFont15"> main aim of this study was to analyze the effect of unemployment</span></span> <span class="s7"><span class="bumpedFont15">and</span></span> <span class="s7"><span class="bumpedFont15">inflation</span></span> <span class="s7"><span class="bumpedFont15">on</span></span> <span class="s7"><span class="bumpedFont15">economic</span></span> <span class="s7"><span class="bumpedFont15">growth</span></span><span class="s7"><span class="bumpedFont15">in</span></span> <span class="s7"><span class="bumpedFont15">South</span></span> <span class="s7"><span class="bumpedFont15">Africa</span></span> <span class="s7"><span class="bumpedFont15">for</span></span> <span class="s7"><span class="bumpedFont15">the</span></span> <span class="s7"><span class="bumpedFont15">period</span></span> <span class="s7"><span class="bumpedFont15">of</span></span> <span class="s7"><span class="bumpedFont15">1994 to 2018</span></span><span class="s7"><span class="bumpedFont15">,</span></span> <span class="s7"><span class="bumpedFont15">using</span></span> <span class="s7"><span class="bumpedFont15">quarterly </span></span><span class="s7"><span class="bumpedFont15">data. The</span></span><span class="s7"><span class="bumpedFont15"> results </span></span><span class="s7"><span class="bumpedFont15">of the</span></span><span class="s7"><span class="bumpedFont15"> unit root test using the Augmented Dickey Fuller and Phillips Perron tests showed that all </span></span><span class="s7"><span class="bumpedFont15">the variables</span></span> <span class="s7"><span class="bumpedFont15">h</span></span><span class="s7"><span class="bumpedFont15">ave</span></span><span class="s7"><span class="bumpedFont15"> a unit root in levels and became stationary after first </span></span><span class="s7"><span class="bumpedFont15">differencing. The</span></span> <span class="s7"><span class="bumpedFont15">Johansen co-integration </span></span><span class="s7"><span class="bumpedFont15">test outcomes</span></span><span class="s7"><span class="bumpedFont15">showed </span></span><span class="s7"><span class="bumpedFont15">that there is a long-run relationship among variables</span></span><span class="s7"><span class="bumpedFont15">,</span></span><span class="s7"><span class="bumpedFont15">and </span></span><span class="s7"><span class="bumpedFont15">the </span></span><span class="s7"><span class="bumpedFont15">Vector error correlation model </span></span><span class="s7"><span class="bumpedFont15">confirmed </span></span><span class="s7"><span class="bumpedFont15">that </span></span><span class="s7"><span class="bumpedFont15">inflation and unemployment have a negative impact on economic growth.</span></span> <span class="s7"><span class="bumpedFont15">Furthermore</span></span><span class="s7"><span class="bumpedFont15">, the</span></span><span class="s7"><span class="bumpedFont15"> results</span></span><span class="s7"><span class="bumpedFont15"> of the </span></span><span class="s7"><span class="bumpedFont15">tests for</span></span><span class="s7"><span class="bumpedFont15"> White Heteroskedasticity, Jarque </span></span><span class="s7"><span class="bumpedFont15">-</span></span><span class="s7"><span class="bumpedFont15">Bera and</span></span><span class="s7"><span class="bumpedFont15"> Serial correlation LM </span></span><span class="s7"><span class="bumpedFont15">reveal </span></span><span class="s7"><span class="bumpedFont15">that there</span></span><span class="s7"><span class="bumpedFont15"> is no problem of </span></span><span class="s7"><span class="bumpedFont15">Heteroskedasticity,</span></span><span class="s7"><span class="bumpedFont15"> data distribution </span></span><span class="s7"><span class="bumpedFont15">or</span></span> <span class="s7"><span class="bumpedFont15">serial correlation </span></span><span class="s7"><span class="bumpedFont15">respectively. The</span></span><span class="s7"><span class="bumpedFont15"> government should implement workable </span></span><span class="s7"><span class="bumpedFont15">pricing regulations</span></span><span class="s7"><span class="bumpedFont15"> and enforce them to maintain stable price </span></span><span class="s7"><span class="bumpedFont15">levels. The government should also through the Department of Higher Education and Training, establish a structure that </span></span><span class="s7"><span class="bumpedFont15">connects</span></span><span class="s7"><span class="bumpedFont15"> the educational system with the industries in South Africa, allowing for the development of skills at the tertiary level and increasing employment.</span></span></p> ER -