Review of the South African Agricultural Legislative Framework: Food security implications

Although South Africa has reported national food security for decades, current production patterns, land uncertainty and consumer preferences put future national household food insecurity in question. Household food insecurity in South Africa is at unacceptable levels. This paper reviews the country's agricultural legislative framework in terms of food security and the right to food. The review found that South African agricultural policies do not actively promote food security and the lack of enforceable food security policy makes it difficult to coordinate existing policies. The lack of food security legislation means that the right to food has no enforceable framework. A comprehensive food security policy, legislative framework and implementation strategy are urgently needed to address hunger poverty to progressively achieve the targets set out for national growth and development and realise the right to food enshrined in the Constitution.     

The dynamic effects of shocks to labour markets: evidence from OECD countries

This paper uses a set of plausible long-run identifying restrictionson a three-variable system, including output growth, real wagegrowth, and the unemployment rate, to isolate three independentstructural shocks which drive fluctuations in those variablesin a sample of 16 OECD countries during 1950-96. These shocksare interpreted as aggregate demand, productivity, and laboursupply disturbances. As a by-product of the previous analysis,the cyclical behaviour of real wages in response to a demandshock is re-examined and two indices of real wage rigidity arederived.     

Shareholder-value maximization and product-market competition

We investigate product-market competition when managers maximizeshareholder value rather than their expected discounted valueof profits. If share-holders are imperfectly informed aboutfuture profitability, shareholder-value maximization can leadto either more or less aggressive product-market strategies.Lower rivals' profits lead investors to believe that the firm'scosts are low relative to those of its rivals and that the industry'sprospects are poor. If the former (latter) inference dominates,each firm tries to lower (raise) its rival's profits to increaseits own stock price. We also consider implications for corporatefinancial structure.     

Requiem for a market: an analysis of the rise and fall of a financial futures contract

Futures contracts often include a variety of delivery optionsthat allow participants flexibility in satisfying the contract.These options have the potential to broaden the appeal of thecontact. However, if these options are valuable, they may reducethe hedging effectiveness of the contract. This article analyzesthe GNMA CDR futures contract that appears to have failed becauseof flaws in the contract's design. For the first 6 years followingits introduction, the contract attracted significant and increasingvolume, but, subsequently, the volume declined to almost zero.Over the years during which the volume experienced its mostdramatic decline, the Treasury-bond futures contract provideda better hedge for current coupon GNMA securities than did theGNMA CDR futures contract. And, over this same period, the valueof the quality option embedded in the contract often exceeded5 percent of the futures price and reached a level of 19 percentat one point. We interpret the evidence to indicate that thecontract failed because the delivery options reduced the hedgingeffectiveness of the contract for current coupon mortgage securities.