/macroeconomics

Macroeconomic modelling for policy formulation

National Treasury (NT) is central to macroeconomic policy in South Africa and holds a key role in maintaining macroeconomic stability around an achievable path of growing output capacity. This work stream is designed to further strengthen the capacity of NT, alongside other actors in the region, and to analyse macroeconomic developments and policy options in southern Africa.

Work on macroeconomic simulation models will be undertaken alongside separate studies related to macroeconomic stability, e.g. fiscal and monetary policies, exchange rate competitiveness, and exchange rate volatility. Two central policy objectives underlie and run through the work stream: raising South Africa’s sustainable growth rate and reducing inequality in South Africa.

The research is focused on five broad areas of policy focus

  • fiscal policy
  • monetary policy
  • public investment and debts
  • regional policy
  • core policy analysis models of South African economy

Each area will engage junior NT officials as team members working jointly with the UNU-WIDER and NT team leaders on the respective topics.

Policy Brief
Harri Kemp and Hylton Hollander
Much of the research on the impact of fiscal policy shocks on macroeconomic outcomes (e.g., fiscal multipliers) uses reduced-form modelling approaches such as vector auto-regressions to obtain empirical results. In a recent study1, we used...
July 2020
Macro modelling
In the media
A stringent lockdown in South Africa came into effect on 26 March 2020 and shut down most sectors of the economy. New SA-TIED research on the impact of COVID-19 on the South African economy estimates...
July 2020
Macro modelling
Climate and energy
Working paper
Johannes Hermanus Kemp and Hylton Hollander
Much of the research on fiscal multipliers has used reduced form modelling approaches. While these models have been extended to include richer controls and identification approaches, it remains unclear whether shocks identified capture the true...
July 2020
Macro modelling
Working paper
Johannes Hermanus Kemp
Despite the frequent use of fiscal policy for stabilization purposes and the important role fiscal activism has played over the last decade, the size of budgetary multipliers (i.e. the output response following an exogenous shock...
July 2020
Macro modelling
Working paper
Serena Merrino
This paper aims at providing new evidence over the effect of conventional monetary policy shocks on wage inequality through the earnings heterogeneity channel under the inflation-targeting regime implemented in South Africa since 2000. The empirical...
June 2020
Macro modelling
Project meeting
17 Jun 2020 / 10:00 to 10:00
Macro modelling
The SA-TIED macroeconomic modelling for policy formulation work stream held their regular work-in-progress meeting on 17 June 2020, via video conference. The meeting provided an opportunity for researchers to share initial results, receive feedback from...
Working paper
Channing Arndt, Rob Davies, Sherwin Gabriel, Laurence Harris, Konstantin Makrelov, Boipuso Modise, Sherman Robinson, Witness Simbanegavi, Dirk van Seventer, and Lillian Anderson
This paper reports ‘first pass’ estimates of the costs of the lock-down implemented by the South African government beginning on 27 March 2020. It also presents a series of recovery scenarios. Four channels by which...
April 2020
Macro modelling
Climate and energy
Working paper
Serena Merrino
This paper investigates the validity of household survey data published by Statistics South Africa since 1993 and later integrated into the Post-Apartheid Labour Market Series (PALMS). A series of statistical adjustments are proposed, compared, and...
March 2020
Macro modelling
Working paper
Rob Davies and Dirk van Seventer
There is evidence from developed countries that technical change affects not only the employment intensity of production, but also the occupational composition of employment. The use of artificial intelligence, automation, and robots has changed the...
March 2020
Macro modelling
Project meeting
11 Dec 2019 / 09:00 to 13:00
Macro modelling
SA-TIED held a work in progress meeting for the work stream on Macroeconomic modelling for policy formulation. The meeting was held at the National Treasury and attended by project researchers under the work stream, staff...