Welcome to the Department
Welcome to the Department of Economics at Stellenbosch University. We are one of the oldest Economics departments on the continent and one of the largest in the university. We are dedicated to quality research and teaching, with a focus on economic issues pertaining to South Africa and Africa. For any information not on this site, please contact the department.
Grade R may lead to further inequality, says Resep researchers
The Department of Policy Monitoring and Evaluation has released a major new study undertaken by ReSEP, a social policy research unit within the Department of Economics, on the effect the introduction of Grade R in most schools has had on learning outcomes in subsequent grades. It is widely accepted that early learning programmes are the most appropriate interventions to overcome the disadvantages faced by children from poor home backgrounds. But the Report found that "…the impact of Grade R in South Africa is small and there is virtually no measurable impact for the poorest three school quintiles, while there are some impacts for the higher quintile schools. Thus, instead of reducing inequalities, Grade R further extends the advantage of more affluent schools. Grade R impacts convert to only 12 days of normal learning gains in maths and 50 days in home language (for a school year of 200 days)". The full report is available here.
Post-Doctoral research fellowship in Macro-Finance
A two-year position is available for a researcher currently holding a PhD who is interested in working on financial factors in business cycles: asset markets, credit, liquidity, and bank capital regulations, preferably in the open-economy context. The closing date for applications is 30 September 2014. Full details available here.
Funding available for PhDs in focus areas
The Faculty's Graduate School of Economic & Management Sciences (GEM) is currently inviting applications for full-time PhD candidates wishing pursue a PhD in one of its defined research themes, to commence studies in January 2015. Scholarships are available to the maximum value of R130 000 per year for three years.
Research themes within Economics include 1) Issues of economic development and social policy (including for instance economic history of a developing country; health policy and social delivery; non-profit organisations in African countries; service delivery; poverty and inequality; economics of education; labour and unemployment), 2) Public economics (including for instance taxation; intergovernmental relations; provincial and local financial management/policies) and 3) Money, macro and finance (for instance the coordination of monetary and fiscal policy; the credit cycle; asset pricing; bank regulation; central bank communication).
The closing date for applications is 31 July 2014. Full details and application forms are available here.
PhD scholarship in Macro-Finance
A scholarship is available for a student to pursue a PhD in Macro-Finance, with a focus on financial factors in business cycles: asset markets, credit, liquidity, and bank capital regulations, preferably in the open-economy context. The closing date for applications is 30 July 2014. Further details are available here.
Ian Stuart appointed as Research Associate
The Department has recently appointed Ian Stuart, Acting Chief Director for the Fiscal Policy Unit, Budget Office in the National Treasury as a research associate for a three year period. Mr Stuart and his team are responsible for South Africa's fiscal framework, budget documents, fiscal policy research and advice to the Minister of Finance. Two working papers that have resulted from Mr Stuart's recent research collaboration with the Department are available: "The accuracy of fiscal projections in South Africa" and "Enhancing the credibility of fiscal forecasts in South Africa: Is a fiscal council the only way?".
Poverty of South Africa's children investigated
The South African Human Rights Commission (HRC) yesterday released its report on poverty traps and social exclusion among children in South Africa. The report was written by members of ReSEP, the research group for Social and Economic Policy within the Department of Economics. The report examines the extent of poverty, inequality, and exclusion among South African children, the characteristics of the most vulnerable groups of children, and the efficacy of existing policies designed to reach those children.
The full report can be downloaded here.
Economics research featured in 2013 Research Report
Research by Rulof Burger, Servaas van der Berg and Dieter von Fintel (How Education Policies Added to Joblessness) and Marisa Coetzee and Ronelle Burger (Bridging the Social Divide with Trust) has been featured in the latest issue of the Stellenbosch University's Research Report.
Rulof Burger and co-authors show that the sharp increase in unemployment numbers in the 1990s may have been due to a change in school policies rather than a weak economy. In 1998, schools were no longer allowed to accept pupils more than two years older than their grade. This forced a large number of pupils into the labour market, increasing unemployment by between 400 000 and 900 000 individuals. The full paper is available here.
Coetzee and Burger show that households where one member is a domestic worker attain higher standards of living than households at similar levels of income but which do not have a member of a household employed as a domestic worker. This shows the importance of 'linking ties' in the process of economic upliftment. The full paper is available here.
Servaas van der Berg appointed SU Distinguished Professor
The University recently recognized a group of about 30 professors as Distinguished Professors with a view to acknowledging exceptional academic excellence. The Department of Economics is privileged to have one of those honoured, namely Servaas van der Berg, on its staff.
The criteria for eligibility include "continuous excellent performance over the last three years; international stature; proven exceptional performance and leadership in higher education in research and publications, postgraduate study leadership, learning and teaching, and community interaction."
More information available here.
Stan du Plessis ranked 4th for Innovative Research by Financial Mail
Prof Stan du Plessis, Dean of the Faculty of Economic and Management Sciences and Professor in Economics, has been ranked 4th in the category Innovative Research in the Financial Mail's latest Ranking the Analysts survey.
In addition to his position as Dean, Du Plessis works part-time as an economist for Prescient Securities.
Published in May 2014, the survey report states that "navigating your way to the top of the pile takes fortitude, investment and dogged focus. The Financial Mail's rankings, now in their 37th year, recognise those who have succeeded."
See the university's press release.
Interview with Servaas van der Berg
The head of RESEP, Professor Servaas van der Berg was recently interviewed by Nic Spaull - a graduate student in the Economics Department and a RESEP researcher - as part of Nic's ongoing Q&A series. Two other RESEP researchers have also participated in the series - Martin Gustafsson and Stephen Taylor.
'Inequality likely to stay'
The Conversation, a British online forum, published a piece today by prof. Servaas van der Berg on South Africa's future prospects. His notes that 'high inequality probably will remain a feature of South African society for decades to come, at least until education and services radically improve and their benefits are felt in the labour market'. The full piece can be read here. The piece was published on 7 May, the day millions of South Africans will vote in the country's fifth democratic elections. The picture shows the queue in front of Stellenbosch city hall early on Wednesday morning.
Andrew Donaldson: Should the South African government redistribute more?
At his annual lecture in the Department on Monday, 7 April, Andrew Donaldson, Deputy Director General responsible for Public Finance in South Africa's National Treasury and Honorary Professor in the Department of Economics, asked whether South Africa should increase redistribution through the budget. Citing an IMF study, he noted that there is mounting evidence that, contrary to economic theory, greater redistribution does not have an adverse effect on economic growth. His provocative question resulted in an interesting debate. In the above photo, Prof. Donaldson (top left) listens to a question from the floor.
Research on markets and social policy feature in Stellenbosch University Research Yearbook
Two members of the department, Prof Servaas van der Berg and Dr Willem H. Boshoff, received recognition for their outstanding research in the annual Stellenbosch University Research Yearbook.
Prof Van der Berg is the NRF Chair in the Economics of Social Policy and is highly respected for the way he uses analytical tools to study subjects like poverty, inequality, income distribution, public finance, social spending, labour markets, migration, regional development and social policies. This he does in an effort to put rational facts and figures behind changes in education, health matters and social grants. Read the full report here.
Dr Boshoff's research tries to expand the understanding of competition in markets. It employs novel statistical techniques to help solve legal problems in South Africa and elsewhere and contributes to a more competitive and healthy economy. Read the full report here.
Michael Jordaan: 'Economics needs new theories that try to incorporate free'
Michael Jordaan, former CEO of FNB and now honorary professor in the Department, gave his first public lecture on Thursday night in the Department of Economics. He discussed the costless economy (such as Google and Facebook) and the implications for the measurement of GDP, inflation, etc when services are free. Here is Prof Jordaan (second from left) with prof Stan du Plessis (dean), prof Rachel Jafta, organiser of the public lecture, and department chair prof Andrie Schoombee.
Top student recognises effort of first-year lecturer
Eldridge Moses (left), a first-year lecturer in the department, was recognised by top performing student Purishlin Govindasamy for his contribution to his study success in 2013. Both attended a First-year Prestige Function on May 19 where Stellenbosch University's top first-years of 2013 were recognised for their efforts, and where their favourite lecturers were invited to share in their success.
Top economics students recognised
The Department recently recognised the achievements of the best students in Economics at its annual prizegiving ceremony at Moore's End in the Dwarsrivier Valley.
Chris Hart was the top postgraduate student in 2013, and won the SA Cloete medal (best postgradute student in economics) for his achievement of an aggregate 81% for his Honours degree studies in 2013. He also received the Ibn Khaldun medal and a cash prize from Genesis Analytics (handed over by Sibonakaliso Mavuka of Genesis, pictured right).
In the undergraduate category, Lewis McLean was the winner of the SA Cloete medal (best undergraduate student,based on performance in all three years of undergraduate studies), here handed over by the Department's Head, Prof Andrie Schoombee.
Lewis also won a cash prize, book and certificate from Genesis Analytics as he is also the best third year student (aggregate mark of 80.5%) and he is currently continuing his studies in economics in the Honours degree programme at Stellenbosch.
Prizes were also awarded to the top students in first and second place in each of the three undergraduate years as well as Honours and Masters. In the picture to the right is Jurie Germishuys, best first year student and Katrien Smuts, second place winner in second year economics. Below is Albertus van Niekerk, best Master's student.
Department appoints four new Research Associates
Dr. Alexander Moradi, Dr. Trudy Owens, Dr. Stephen Taylor, and Dr. Francis Teal were recently appointed as Research Associates in the Department of Economics. The four new appointees join our six existing Associates - Julius Agbor, Leigh Gardner, Martine Mariotti, Caryn Bredenkamp, Mariné Erasmus and Ramos Mabugu - and will serve a three-year term.
Alex Moradi is a development economist and economic historian at the University of Sussex, UK. His research has mostly investigated the causes and consequences of undernutrition and poor health in developing countries.Trudy Owens is a development economist at the University of Nottingham, UK. Her primary focus is on poverty, growth and non-governmental organisations of African countries. Stephen Taylor is an education expert in South Africa's Department of Education. He is also a former PhD student in the Department, and his research continues his interest in South Africa's underperforming education system. Read an interview with him here. Francis Teal was the Deputy Director of the Centre for the Study of African Economies at Oxford University from 1996 to 2012. His focus is on the analysis of firms and labour markets in Africa.
Lant Pritchett visits Stellenbosch
Lant Pritchett, a professor at Harvard Center for Global Development and the Harvard Kennedy School of Government visited ReSEP and the Department of Economics from 16 to 26 January 2014. He is widely known for his innovative and path-breaking work in development in areas such as education, health and social delivery. During his visit, Professor Pritchett presented a number of seminars, spent two days in a ReSEP workshop on education, health and the labour market and then interacted in small group discussions with ReSEP researchers and Department of Basic Education officials around these topics.
Prof. Pritchett's most recent book, The Rebirth of Education: Schooling ain’t Learning, investigates the low learning trajectories that are so common in developing countries and shows that input-based approaches to school, or simply focusing effort on getting more children to school or keeping them in school longer, will contribute little to reducing the learning deficit of most developing countries compared to developed countries. He was thus very enthusiastic about ReSEP research that draws similar conclusions for South Africa and also other countries in Southern and Eastern Africa.
Prof Stan du Plessis appointed as Dean
Stan du Plessis, professor in the Economics Department and current vice-dean (research), has been appointed as the new dean of the Faculty of Economic and Management Sciences from 1 April 2014.
Among other aims, he endevours to focus on strengthening the Faculty's research profile through external collaboration and expanding the number of doctoral students in the faculty.
The Department is confident that Prof du Plessis will continue to achieve excellent results in the faculty (as he has done in the Department) and looks forward to continue working closely with him in his new position.
(See also the University's announcement).
Prof. Basil Moore lost in the Groot Drakenstein mountains for 5 days
On the morning of Wednesday 27th November, Prof. Basil Moore, extraordinary professor in the Department of Economics, left for his usual one to two hour runs from his farm in the Banhoek Valley. He set off in his ‘bakkie’ with his two Rhodesian Ridgebacks. He parked in his usual spot beside the old Anglo-American orchards. Feeling particularly good, he accidently found the old path up to the burned-down mountain hut on the Groot Drakenstein mountain. The path above the hut was very over grown, and he soon became lost in the dense fynbos below the cliffs of the mountain. Having chosen the most direct option towards home, he descended into the valley, but in the mountain’s water catchment area, the bush and shrubs became near impenetrable.
The next morning Prof. Moore found himself quite disoriented due to the very thick fynbos. He continued to push through, but the going became slower and tougher. He failed to make good time, as he descended further and deeper in the valley. By this time Wilderness Search and Rescue (WSAR) used helicopters to survey the area and look for him.
For the next two days, WSAR, local authorities and neighbouring farmers banded together and searched intensively for Prof. Moore. Professional sniffer dogs were brought in to help.
On Sunday morning a searcher came through on the radio that a dog’s bark was heard. Prof. Moore was finally found hanging on to some trees for support. He was bruised, cut up and gaunt; wearing one shoe, with no shirt and only his black running shorts. He spent two nights recovering in the Stellenbosch Medi-clinic but has since returned home and is eager to get back to the hills again. The dogs remain in good health and are happy to see him home.
Prof. Moore’s wife, Sibs, insists that she is not letting him out of her sight until he has been embedded with a tracking device.
Racial Inequality Declines to its Lowest Levels Yet
A comprehensive, two-year long interdisciplinary study by researchers from ReSEP and the Political Science department at Stellenbosch University found that the income gap between race groups is the lowest it has ever been. According to ReSEP member Servaas van der Berg it is no longer true that South Africa’s middle class is mainly white, since black South Africans now represent the largest share of the middle class. Click here for details.
researchers from ReSEP and the Political Science department at
Stellenbosch University found that the income gap between race groups is
the lowest it has ever been. According to ReSEP member Servaas van der Berg it
is no longer true that South Africa’s middle class is mainly white,
since black South Africans now represent the largest share of the middle
class. - See more at: http://resep.sun.ac.za/#sthash.s5EblOba.dpufA comprehensive, two-year long interdisciplinary study by researchers from ReSEP and the Political Science department at Stellenbosch University found that the income gap between race groups is the lowest it has ever been. According to ReSEP member Servaas van der Berg it is no longer true that South Africa’s middle class is mainly white, since black South Africans now represent the largest share of the middle class. - See more at: http://resep.sun.ac.za/#sthash.s5EblOba.dpuf
Horizontalists and Verticalists: 25 years later
The latest issue of the Review of Keynesian Economics includes a special mini-symposium honouring the 25th anniversary of Basil Moore's book, Horizontalists and Verticalists (1988). Basil Moore is Professor Extraordinary in the Department of Economics at Stellenbosch University.
The book has been particularly influential in advocating a "horizontalist" view of monetary policy, which is that in a credit-based economy, the money supply is endogenous and determined by demand, and not by central bank supply of high-powered money, as the "verticalists" believe. In one of the mini-symposium articles, the authors' (Bindseil and König) assessment is that "the book has impressively stood the test of time and, despite part of textbook economics still insisting on the money multiplier as an explanation for the money supply, it is not much of an exaggeration to say that we have all become ‘Horizontalists’ in the last 25 years."
Young Economist 2013 competition - winners announced
The winners of the Die Burger and Department of Economics 2013 Young Economist of the Year competition were announced at a function on Monday evening. First year students taking part in the competition, in teams of two students each, had to forecast economic indicators such as inflation, GDP growth and exchange rates using an electronic platform developed for the purpose. For the first time this year, the competition was opened up to students from the University of Cape Town, resulting in additional competition and an aspect of friendly rivalry between the instititutions.
As it turned out, the team that submitted the most accurate forecasts was from Stellenbosch, while the runners-up were from Cape Town (details here). The winners, William Melville (left in the picture) and Dewald Müller (right), walked away with a prize of R10 000 to share between them. Asked about their experience in the competition, they indicated that it took time and effort to make accurate forecasts. "We tried to read different financial and normal newspapers daily to get us up to date with current affairs and have a feeling for the state of the world economy. As the competition progressed we learnt that we had to take more and more factors into consideration."
"The most challenging was definitely the currency predictions due to the volatile state of the currency and the uncertainty in the world markets at the moment. At the end not just the monetary reward but also the knowledge gained makes the competition definitely worthwhile."
Stellenbosch students win ESSA Founders' Medals
Two students in the Department have won Economic Society of South Africa (ESSA) Founders' Medals this year. ESSA awards these prizes each year for the best thesis in South Africa in four categories (honours, short masters, long masters and doctoral).
Derek Yu has been a researcher and doctoral student at the department, and is currently a lecturer at the University of the Western Cape. His doctoral thesis is entitled Using household surveys for deriving labour market, poverty and inequality trends in South Africa and was completed under the supervision of Servaas van der Berg. The thesis is a thorough investigation of a large number of household surveys conducted in South Africa since the democratic transition in 1994, with a specific focus on methodology, data quality issues and comparability between different surveys. The thesis points out the dangers of naive comparisons across surveys and develops procedures for achieving comparability and addressing other data problems. The work is expected to be useful to many other researchers and to improve the quality of survey data research in South Africa generally.
The prize in the category for Master’s dissertation in full fulfillment of the degree was won by Jeanne Cilliers. Her thesis is entitled Cape Colony marriage in perspective and investigates a new data set of genealogical records to track ancestry and marriage patterns of colonial settlers in South Africa. It examines whether the notion of a European Mariage Pattern (EMP) (due to J. Hajnal, 1965) characterises the marriage patterns that emerged in the Cape Colony in the eighteenth and early nineteenth century, as well as the potential causes for these patterns. Her supervisor was Johan Fourie.
Marisa Coetzee wins 2013 Middleton award
The South African Journal of Economics (SAJE) recently honoured Marisa Coetzee, a researcher and doctoral student in the Department, by awarding her the 2013 Middleton Award for the best article by a first-time SAJE author. Her article was published in the September 2013 issue of the journal and is entitled Finding the Benefits: Estimating the Impact of The South African Child Support Grant. The article uses data from the 2008 South African National Income Dynamics Study (NIDS) and investigates the impact of the child support grant on measures of well-being in terms of health, nutrition and education. The research shows that the grant is indeed linked to better outcomes for the targeted children, even though the effects are small.
Marisa will join the Department as lecturer from 1 January 2014.
Stellenbosch well represented at ESSA2013 conference
A large contingent from the Department of Economics at Stellenbosch University recently attended the very succesful Biennial Conference of the Economic Society of South Africa held in Bloemfontein. A total of 35 papers (click on "Read More" below to see a list) were presented by delegates from the Department and their co-authors. In addition, Servaas van der Berg presented a keynote address entitled "Education, poverty and affluence - a South African perspective" (more detail on the address available here).
Most of the papers can be downloaded in pdf format and all abstracts can be viewed at the conference website.
Stan du Plessis: State-contingent forward guidance could be a "terrible mistake" for central bank
Assurances of low interest rates in the future have in recent times become a policy instrument in the hands of monetary authorities in the USA, the UK and the EU, the idea being to encourage spending in the short run in the face of potential future interest rate increases. But Stellenbosch University professor Stan du Plessis points out that there would be potentially disastrous consequences if this type of policy instrument were adopted in SA. For the SA monetary authorities to commit to low interest rates until unemployment declines could put the central bank in a difficult spot later on by creating expectations that the SARB can in fact control the unemployment rate on a sustained basis, a goal which is beyond the reach of monetary policy. Accepting inappropriate goals could lead to policy confusion and a loss of credibility for the SARB.
Professor du Plessis's comments were published in a recent article in the Financial Mail, which also discusses alternative policies that avoid these pitfalls.
ReSEP website launched
The Research on Socio-Economic Policy (ReSEP) group at the Department of Economics today launched a new website which will serve as a resource for researchers and policy-makers interested in issues surrounding socio-economic development in Southern Africa. Spearheaded by Professor Servaas van der Berg, the ReSEP group consists of members of the Department of Economics, contract research staff and graduate students, and developed around a long term research focus on issues of poverty, income distribution, social mobility, economic development and social policy. The new website contains information on ReSEP’s involvement in various research projects, provides access to downloadable working papers, policy briefs, and other research reports produced by members of the ReSEP team, and will in time also provide access to further learning and training materials for policy-makers, researchers, students and others interested in policy debates. Visit the new website at http://resep.sun.ac.za/.