Money Supply and Economic Activity in South Africa – the Relationship Updated To 2011
This paper reconsiders the relationship between measures of money and measures of economic activity in the South African economy and the role of the Reserve Bank in moderating South African economic cycles. By using data for the past twenty years, the earlier analysis is updated and reassessed so that it is possible to see if the fundamental relationships between money, credit and economic activity have changed and whether the role of the Reserve Bank in managing economic activity has become more pivotal and constructive. One important difference noted is that broadly defined money (M3) does better in explaining economic activity between 2000 and 2011 than narrowly defined money. The opposite is true for the earlier sub-periods. The paper utilises a model of the money supply process to explain why the relationship between narrowly and broadly defined money changed after the year 2000 with regulations that encouraged the banks to reduce their demands for cash leading to an increase in the money multiplier. The paper concludes that the ability of the SA Reserve Bank to moderate the money and bank credit cycles, utilising interest rates as the primary instrument of monetary policy, remains as elusive as ever.
WP/10/01- Central bank balance sheet policy in South Africa and its implications for money-market liquidity
Abstract From the introduction of the repurchase-based refinancing system in March 1998, the size of the balance sheet of the South African Reserve Bank (SARB) has increased almost eight times. This balance sheet growth was accompanied by fundamental changes in the structure of assets and liabilities, resulting mainly from the closing out of the oversold forward foreign exchange book of the SARB until 2004, and the accumulation of foreign exchange reserves thereafter. This paper analyses the impact of the management of the balance sheet of the South African Reserve Bank (SARB) on money-market liquidity conditions in the banking sector. It also discusses a number of implications of trends in the SARB’s balance sheet policy, namely the shrinking money-market shortage in real and relative terms, the cost and effectiveness of monetary policy operations, the cost of reserves accumulation, balance sheet implications of alternative funding structures and financial stability considerations relating to the SARB’s balance sheet policy.
Effekte einer freiwilligen Mitgliedschaft in Berufsverbänden auf das Einkommen: Eine Analyse der Einkommensdynamik bei Freiberuflern in Deutschland
Central question in our analysis is if voluntarily organised Professions, i.e. self-employed Liberal Professions (Freiberufler) in professional organisations, yield a higher income than those not associated to any professional organisation. To answer this question four waves from the German Socio-Economic Panel Survey Study (GSOEP) are used. Descriptive statistics show a positive link of gross monthly income and those who are voluntarily associated in professional organisations. Because gross monthly income is influenced by the amount of actual hours worked, gross hourly income is the central magnitude of interest. The aforementioned positive link is widely confirmed by descriptive statistics of corresponding gross hourly income. To measure causal effects through voluntary membership in professional organisations a fixed-effects-model in consideration of unobserved and time constant heterogeneity is estimated. We find a negative premium in gross hourly income for voluntarily organised Professions which varies between -7,67 und -9,15 %.