Macro-fiscal analysis and policy modelling

South Africa’s economy experienced a particularly steep decline —relative to other emerging markets— during the 2009 Global Financial Crisis. These economic challenges were exacerbated by the COVID-19 pandemic and impact South Africa’s ability to expand health coverage, decrease unemployment, and increase start-up and entrepreneurship rates.

The work stream on Macro-fiscal analysis and policy modelling will improve policymakers’ and institutions’ abilities to carefully assess the risks and opportunities of the macroeconomic policies intended to solve South Africa’s economic problems. Through its efforts to improve the macroeconomic modeling capacity of the institutions responsible for economic policy, the work stream will strengthen decision-making and contribute to broader economic stability and growth in South Africa.

Additional work includes:

  • evaluation of coordination between macroeconomic policy components: their impact on each other and overall macroeconomic outcomes
  • evaluation of the conduct of fiscal policy against its stated objectives
  • evaluation of the Reserve Bank’s conduct of monetary policy against its stated objectives
  • improving our ability to model reality in macro simulations
  • estimation of the determinants of the yield curve and optimal debt management

Outputs

One of the primary goals of this work stream is to improve the flow of information from academics working on policy-relevant and evidence-based research to actual policymakers. As a continuation of SA-TIED Phase I, the macro-fiscal work stream will focus on four broad areas of policy:

  • fiscal policy (public investment and debt, tax policy, and expenditure)
  • monetary policy (including inflation targeting and exchange rate policy)
  • micro- and macroprudential policy
  • coordination of macroeconomic policy and its impact on savings, investment, and the balance of payments
Working paper
Joshua Budlender
South Africa frequently experiences rolling blackouts (‘load shedding’) due to shortfallsin electricity generation. This is a common problem across the developing world, and yet thedevelopmental impacts of insufficient and unstable electricity supply, and the benefits...
JULY 2024
Macro-fiscal analysis
In the media
SA-TIED
In his latest article covered by Business Live, Philippe Burger discusses tackling fiscal fatigue in South Africa. He examines government finances and fiscal policy, highlighting the factors behind rising public debt, including low GDP growth...
JUNE 2024
Macro-fiscal analysis
News
SA-TIED
An SA-TIED work-in-progress Working Paper was presented at the Conference of the International Association for Applied Econometrics (IAAE China 2024) from June 7 to June 9 by SA-TIED Research Fellow, Richard Kima. The working paper...
JUNE 2024
Macro-fiscal analysis
In the media
SA-TIED
The SA-TIED Working Paper titled " Watts happening to work? The labour market effects of South Africa's electricity crisis" has received significant media attention. This paper explores the impact of frequent electricity outages (load shedding)...
May 2024
Macro-fiscal analysis
Blog
Richard Kima
In 2024, central banks worldwide are confronted with the challenges of juggling inflation control , economic growth, and the preservation of financial stability. A new report from the United Nations Department of Economic and Social...
MAY 2024
Macro-fiscal analysis
Working paper
Abhishek Kumar and Sushanta Mallick
Given the rise in the government debt level in recent times, this paper aims to examine the effect of an increase in government size on risk premium and its transmission in the economy. We jointly...
APRIL 2024
Macro-fiscal analysis
Blog
Hylton Hollander and Roy Havemann
Over the past decade, the interest rate that South Africa pays on its debt has consistently been above the economic growth rate. Mathematically, this means that debt grows as a percent of GDP. It becomes...
March 2024
Macro-fiscal analysis
In the media
SA-TIED
An SA-TIED Working Paper was recently spotlighted in Business Times . Authored by Roy Havemann and Hylton Hollander, the article critically examines South Africa's fiscal landscape over the past decade, exploring key challenges faced by...
March 2024
Macro-fiscal analysis
Blog
Philippe Burger
Introduction The South African constitution includes a number of socioeconomic rights, such as the right to education and access to housing, food, and healthcare. Nevertheless, the constitution qualifies some of the socioeconomic rights by the...
November 2023
Macro-fiscal analysis
Working paper
Philippe Burger
The South African constitution is considered progressive and transformative in intention due to its inclusion of socioeconomic rights, such as the right to education, land, food, and healthcare. However, some of these rights are qualified...
October 2023
Macro-fiscal analysis
News
SA-TIED
SA-TIED marked a significant milestone on 13 October 2023, by hosting an inaugural National Treasury Secure Data Facility (NTSDF) data lab roadshow at the University of Pretoria . The event featured a presentation by the...
October 2023
Enterprise development
Public revenue
Labour market and inequality
Macro-fiscal analysis
Climate and energy
Reform implementation
Working paper
Gideon du Rand, Hylton Hollander, and Dawie van Lill
A critical requirement for efficient fiscal policy is a reliable understanding of its impact on the aggregate economy for different policy instruments and under different economic conditions. Indeed, there is strong evidence to suggest that...
AUGUST 2023
Macro-fiscal analysis