Browsing by Author "Viegi, Nicola"

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    Deregulation, financial deepening and savings performance in Zambia: 1978-2006
    (2008) Simwanza, Harriet; Viegi, Nicola
    This paper attempts to review the impact of financial reforms largely undertaken in the early 1990s on the financial sector of Zambia. In particular, it investigates the influence of the reforms on the depth of the financial sector. This analysis is made by means of simple monetary and financial ratios. The paper further seeks to explore the behavour of financial savings in relation to real GDP, financial deepening, inflation, and real interest rate using an error correction model over two sample periods, with one period representing the pre-liberalisation period and the other representing the post-liberalisation period. The paper finds that there has not been any significant growth in the depth of the financial sector. With regard to the behaviour of financial savings, the empirical results show that financial savings respond more positively to an increase in financial depth and an increase in real deposit rate for the post-liberalisation period.
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    Essays on the political economy of 20th century colonisation and decolonisation in Africa
    (2010) Agbor, Julius Agbor; Fedderke, Johannes; Viegi, Nicola
    The focus of this dissertation is on colonisation and decolonisation as cornerstones in the development of sub-Saharan Africa's current institutions and how these historical institutions affect current economic growth outcomes. The dissertation consists of three main chapters besides the introductory and concluding chapters. The rst main chapter considers conditions of optimality in a co-optive strategy of colonial rule. It proposes a simple model of elite formation emanating from a coloniser's quest to maximise extracted rents from its colonies... In the second main chapter, I argue that the pattern of decolonisation in West Africa was a function of the nature of human capital transfers from the colonisers to the indigenous elites of the former colonies. Underpinning the nature of these human capital transfers is the colonial educational ideology... The third main chapter investigates the channels through which colonial origin affects economic outcomes in sub-Saharan Africa (SSA). It focuses on four key channels of transmission namely, human capital, trade openness, market distortion and selection bias.
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    Estimation and evaluation of potential output dyanamics in an emerging country
    (2009) Theoduloz, Tania; Viegi, Nicola
    The aim of the dissertation is to give an overview of some of the most relevant and popular methods suggested for estimating potential output and the output gap. Three alternative methodologies - the Hodrick-Prescott filter, the production function approach and the SVAR approach - are compared and assessed empirically with respect to data representing the economic development of Uruguay in the last twenty years. Given the recent growth slowdown and abrupt recovery of Uruguay's GOP, the objective is to provide evidence on whether such changes are principally a cyclical shortfall or instead represent a structural shift towards a new growth path. Once the output gaps are estimated, their capacity as indicators of inflationary pressures is assessed through a basic gap model in which the change in inflation is related to the output gap, the money supply and the terms of trade.
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    Fiscal aspects of macroeconomic stability in Africa
    (2009) Obinyeluaku, Moses Ikechukwu; Viegi, Nicola
    This study analyses empirically the nature of fiscal and monetary policy interdependence and fiscal dynamics in africa. It also looks at the possibility of implementing viable fiscal policy rules and institutions that are consistent with economic and monetary stability and growth. The study starts off by looking at the way economists have framed the analysis of fiscal and monetary policy interdependence. While conventional theory holds that inflation is a onetary phenomenon, recently the Fiscal Theory of Price Determination (FTDP) has instead argued that inflation can be a fiscal phenomenon.
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    House prices, monetary policies and the macroeconomy : what does the common trends approach on South African data suggest?
    (2008) Mistry, Smeeta; Viegi, Nicola
    The increased volatility of asset prices in both developing and developed economies seems to be a growing concern for economic policy makers. Whilst there is a growing literature investigating the link between monetary policy and its implications for asset price volatility there remains uncertainty regarding the overall effects of macroeconomic shocks on longterm asset prices. Using a VAR framework and South African house price data from 1970 to 2006, this paper takes a preliminary step towards identifying how this asset price responds to macroeconomic shocks and the relative importance of these shocks.
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    Institutional and macroeconomic policy dynamics in transition economies
    (2008) Kularatne, Chandana; Fedderke, Johannes; Viegi, Nicola
    This study is an investigation of some of the developmental challenges facing transition economies. The thesis provides empirical and theoretical analyses on some of the institutional and macroeconomic challenges experienced by transition economies along their developmental trajectory. The thesis begins with an analysis of the reallocation of resources. Chapter 2 presents a model in which two groups in society are engaged in strategic interaction. Privileged members of society have the opportunity to allocate resources either to their own productive capacity, or to enhance the productive capacity of the disadvantaged. Redistribution to the disadvantaged can increase the productive capacity of society, but comes at the cost of rising political aspirations of the poor, which erodes the power of the rich. The results of the model derive possible political outcomes for society under which the rich will redistribute to the point of equality with the poor; conditions under which the disadvantaged face genocide; as well as the range of intermediate redistributive activity likely to be employed by the privileged. Transition economies also face limited infrastructure development. This is especially true for countries in post-conflict situations. Increasing levels of infrastructure expenditure is argued to have a positive effect on growth. Chapter 3 analyses the impact of economic and social infrastructure on economic growth for a specific transition economy - South Africa. South Africa experienced a declining trend in physical infrastructure development. over the recent past. The econometric results find that while economic infrastructure has a positive effect on output, social infrastructure has no effect. Crowding out effects arising from both economic and social infrastructure expenditure are also discovered. The data also reveals that both output and private investment have a positive effect on economic and social infrastructure expenditure. The short term fluctuations in output, employment and labour productivity in South Africa are also investigated. The empirical evidence of negative correlation between employment and labour productivity contradicts the hypothesis of standard real business cycle theory. A model with monopolistic competition, sticky prices, and variable effort is shown to be able to account for the empirical findings. The findings indicate that technology shocks generate a negative co-movement between labour productivity and employment in South Africa. In addition, the degree of monetary accommodation, returns to labour and the degree of price stickiness and imperfect competition affects economic fluctuations in employment and labour productivity due to technology and demand shocks. Moreover, they affect the response of prices, real money balances and real interest rates to a technology shock.
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    Socio-economic inequality and ethno-political conflict : evidence from Kenya
    (2009) Rono, Lorraine; Viegi, Nicola
    This study examines the influence of socio-economic inequalities on the probability of conflict in Kenya and aims to synthesise various causal hypotheses in the literature. This research extends to a regional analysis of a cross-national sample to understand the extent to which structural cleavages account for a cause of potential conflict in Kenya. The post-election violence that emerged in 2008 shed light on the urgency for policy reforms to address the root causes of what was viewed as an imminent outbreak of violence. Various analysts trace the origin of conflict to nepotism, ethnic stratification, historical injustices, poor governance and disparities in resource allocation. Given these sources of dissent, this study proposes that the most fundamental factors that considerably influence the probability of conflict in Kenya are pervasive poverty and extreme inequality, intensified by ethnic divisions. Based on Kuznets theory, we argue that the booms of economic growth experienced from 2003 perpetuated the stark economic and social inequalities prevalent in Kenya. As a result, there is strong evidence that suggests that these sharp inequalities fuelled the post-election violence and deeply influence the probability of conflict in Kenyan society. Another key contribution from the study is the conclusion that the existence of sharp horizontal inequalities result in a bias towards ethnic conflict. It is imperative to identify the underlying causes of conflict so as to neutralise polarisation which exacerbates tension and breeds further conflict. In light of this view, the probability of conflict in Kenya can be minimised effectively and such mitigation can be used as a mechanism for future growth and economic development in Kenya.