Risk management with interdependent choice

Risks faced by traders from price movements are sometimes magnifiedby the actions of other traders. Risk-management systems whichneglect this feature may give a seriously misleading pictureof the true risks. The hazards arising from this potential blindspotare at their most dangerous when the prevailing conventionalwisdom lulls traders into a false sense of security on the attractivenessof a trading position. The efforts of one trader to reversehis trade makes more acute the need to follow suit on the partof others. For markets dominated by traders with short timehorizons, such interdependence leads to exaggerated price movements.Estimates of 'value at risk' which recognize such interdependenceof actions can diverge substantially from those given by conventionaltechniques.     

Existence level differences and spatial industrial restructuring in South Africa: RDP imperatives

The change of government in South Africa and the subsequent implementation of the Reconstruction and Development Programme (RDP) has necessitated afresh look at the spatial‐economic development policies of the past. Recently, an attempt was made to measure differences in existence level in South Africa using a combination of First and Third World criteria. In this paper these differences are related to general trends in population redistribution in the country since 1960 in an effort to assess the probable impact of existence level difference and migration on urbanisation in South Africa in the long run. On the basis of these assessments, expected trends in urban development in South Africa are compared with previous industrial development policies in an effort to determine RDP imperatives for the future.