The issue of whether public debt is useful or harmful towards economic growth is one of the most prevailing debates in the literature with no consensus existing on the subject matter. The study employs the ARDL model to examine the long-run and short-run effects of public debt on economic growth for South African data spanning a period between 2002:q1 and 2016:q4. Our sensitivity analysis consists of re-estimating our empirical regressions using two sub-samples dataset corresponding to the post-crisis period (i.e. 2007:q3–2016:q4). All estimated regressions unanimously find negative debt–growth relationship, with the negative relationship strengthening in the post-crisis period. Overall, our empirical results have some useful ramifications towards fiscal policymakers.

Using annual data collected from 1988 to 2015, this study provides evidence of a non-linear relationship between military spending, economic growth and other growth determinants for the South African economy. The empirical study is based on estimates of a logistic smooth transition regression (LSTR) model and our empirical results point to an inverted U-shaped relationship between military spending and economic growth for the data. Furthermore, our empirical results suggest that the current levels of military spending, as a component of total government expenditure, are too high in the South African economy and need to be transferred towards more productive non-military expenditure in order to improve the performance of economic growth and other growth determinants.

What are the characteristics of recipient countries that attract more climate finance in mitigating and adapting to climate change? In this study, we address this question by looking at recipients in 43 Sub-Sahara African countries for the period 2006–2017, and implement several panel regression techniques, including system generalized methods of moments estimations to address potential endogeneity concerns. We also performed sensitivity analysis using panel quantile regressions. The findings show that Sub-Sahara African countries with higher population growth rate, higher poverty levels, better ease of doing business profile, weaker governance policies, weaker control of corruption, stronger rule of law enforcement, deepened social inequality, and better ICT usage, have attracted more climate finance. Policy implications of the study are discussed.

The study investigates whether export diversification or export specialization is more useful toward promoting economic growth in BRICS countries. We estimate a dynamic growth model augmented with trade activity to capture the diversification-concentration trade-off with economic growth for BRICS economies over the period of 1995 to 2017 using FMOLS, DOLS, and PMG estimators. Altogether, we find a positive (negative) relationship between export concentration (diversification) and economic growth in BRICS countries. Further analysis points to a semi-inverted U-shaped diversification schedule, of which the BRICS countries have crossed their “inflexion point” of development and need to re-specialize their export baskets.

Purpose: – The purpose of this paper is to investigate asymmetric cointegration and causality effects between financial development and economic growth for South African data spanning over the period of 1992-2013.Design/methodology/approach: – This study makes the use of the momentum threshold autoregressive (M-TAR) approach which allows for threshold error-correction (TEC) modeling and Granger causality analysis between the variables. In carrying out an empirical analysis, the author uses six measures of the financial development variables against gross domestic per capita, that is, three measures which proxy banking activity and another three proxies for stock market development.Findings: – The empirical results generally indicate an abrupt asymmetric cointegration relationship between banking activity and economic growth, on the one hand, and a smooth cointegration relationship between stock market activity and economic growth, on the other hand. Moreover, causality analysis generally reveals that while banking activity tends to Granger cause economic growth, stock market activity is, however, caused by economic growth increase.Originality/value: – This study contributes to the literature by examining asymmetries in the cointegration and causality relations by using both banking and stock market proxies against economic growth for the South African economy.

New economic thinking speculates that the diversification and sophistication of economic capabilities/structures is key in explaining why African countries lag in development behind the rest of the world. We question the extent to which non-traditional growth factors such as governance and institutional quality are related to economic complexity for 35 African countries. We estimate panel GMM regressions using 8 different measures of governance/institutional quality for both linear and kinked regressions using annual data collected between 1996 and 2021. The baseline estimates reveal a positive linear relationship between most measures of governance and institutional quality and economic complexity. Our sensitivity analysis further show that institutions/governance have stronger relationship with economic complexity in the post-global financial crisis era. Moreover, nonlinear or kinked relationships emerge once the data is segregated into different income and resource abundant groups. Altogether, our findings of a nonlinear relationship between institutions/governance and economic complexity are novel to the literature and offer unique insights on how African policymakers can use governance/institutions for improving the complexity of production processes.