Structural adjustment in Africa: Insights from the experiences of Ghana and Senegal

Structural adjustment in Ghana and Senegal has helped create an improved framework for economic growth. But this is a fragile trend, one that could be disrupted by bad weather, adverse terms of trade, and the vagaries of international assistance. The current version of adjustment, however, has produced little enduring poverty alleviation. A weak performance on equity issues, together with rising political expectations, has generated threats to the sustainability of structural adjustment and overall political stability. Alternatively, adjustment policies can be modified to fully incorporate equity and sustainability objectives. In this respect, it is critical for the poor to obtain more effective representation in decision-making on adjustment through indigenous nongovernment organizations.     

Trade liberalisation,structural adjustment and intra-industry trade: A note

Conclusions This note reports tests of the relationship between trade liberalisation and the levels of intra-industry trade, and between levels of IIT and structural adjustment in response to trade liberalisation. It has used a new approach by focussing on the impact of changes in protection on (i) changes in IIT, and (ii) differences in structural adjustment over time in high-IIT and low-IIT sectors.     

The welfare effects of the antebellum tariff: A general equilibrium analysis

In this paper a general equilibrium model of the United States in 1859 is developed and solved using the Scarf algorithm. Such a formulation allows the U. S. equilibrium to be computed for differing parameter specifications, so that the comparative static effects of policies involving even very complex interactions within the economy may be analyzed. In this case, the general equilibrium effects of the tariff in the United States are examined by comparing the actual, or initial, equilibrium with a hypothetical equilibrium in which the tariff has been eliminated. We find that the South was in fact injured by the tariff; the price of cotton and the return to slaveholding would have both risen significantly with its elimination. The principal beneficiary of the tariff was free labor. Removal of the tariff would have produced a decrease in the real wage and a slight fall in the return to capital. Overall, real income in the United States would have declined by 1.07 to 1.09% as a result of tariff elimination, or by between $44 and $45 million in current prices. Alternative parameter specifications may produce different results, ranging from the Metzler paradox in the case of very inelastic substitution in R.O.W. consumer demand to cases of increases in real income with tariff elimination in the cases of elastic substitution in either R.O.W. or U. S. consumer demand. A final caveat in judging the results should be inserted here. Factor endowments for 1859 are taken as fixed. The comparative static results here answer the question: What would have the 1859 United States been like if the tariff had been eliminated, allowing time for full adjustment? No dynamic effects are taken into account, such as adjustments in factor supplies. Consequently, the 1859 United States that had consistently followed a free trade policy would have looked quite different from the one that pursued a policy of protection and then eliminated the tariff, which we consider here.     

Current account balances and structural adjustment in the euro area

In the past decade, a set of euro area countries has accumulated large current account deficits. After a brief relaxation of the euro area internal imbalances in the wake of the financial crisis, it appears as if this pattern arises anew when times normalize again and Germany still sticks to export-led growth. This issue has been labelled one of the most challenging economic policy issues for Europe inter alia by the European Commission and some other players on the EU level. In this paper, we analyse the role of private restructuring and structural reforms for the urgently needed sustainable readjustment of intra-euro area current account balances. A panel regression reveals a significant impact of structural reforms on intra-euro area current account balances. This implies that in particular structural reforms and wage restraint in notorious current account and budget deficit countries such as Greece are highly suitable to support long-term economic stability in Europe.     

新中国经济结构战略调整的历史变迁及宏观政策分析

新中国经济经历了三次大的结构调整，既有成功经验，也有局限性。在改革开放，建立社会主义市场经济体制新的历史条件下，对新中国经济结构战略调整的变迁及宏观政策进行评价，对当前正在进行的经济结构战略调整的健康发展是有积极的启发和借鉴意义的。     

Tourism and welfare in Sub-Saharan Africa: a theoretical analysis

Using the standard theoretical model of trade, we study thewelfare effects of tourism for developing countries with particularreference to Sub-Saharan Africa. We show that tourism can reducewelfare for trade regimes dominated by export taxes or importsubsidies. In addition, we argue that tourist immiserisationis possible for Sub-Saharan Africa. Finally, we show that directforeign investment in tourism, is for the most part, beneficial.     

An analysis of the impact of the first phase of South Africa's motor industry development programme (midp), 1995–2000

The South African motor vehicle industry is an important branch of the local manufacturing sector, contributing significantly to manufacturing value added and employment. Over the last decade, the local industry has undergone a series of policy reforms, and in recent years has increasingly been exposed to globalisation. This article reviews the role of government policy in shaping the industry, and examines the impact of the first phase of the Motor Industry Development Programme on the industry for the period 1995–2000 in respect of domestic production, automotive industry employment, export performance and the automotive trade balance. The article concludes that even though the industry registered strong export growth that contributed to improving the automotive trade deficit, it was deficient in sustaining domestic production and employment levels. The imminent challenge for the local industry's development is to maintain its export growth trajectory in the long term in the absence of costly government protective incentive mechanisms.     

Food security and structural adjustment: Empirical evidence on the food price dilemma in Southern Africa

This article considers effects of price on food security and the food equation in the developing areas of South Africa. Firstly, the food (or hunger) equation is examined in more detail. Secondly, thefood price dilemma is analysed using empirical data obtained elsewhere in sub‐Saharan Africa. Thirdly, the situation in the developing areas of South Africa is examined. Empirical evidence in sub‐Saharan and Southern Africa accentuates the skewness and concentration in the market participation profile of rural households with respect to especially staples. Supply response to higher prices in these areas is also limited. These findings place the food price dilemma on centre stage in Southern Africa.     

Political feasibility of structural adjustment in africa: an application of SAM mixed multipliers

The implementation of structural adjustment programs (SAPs) has often been undermined by opposition from politically powerful groups who are favored by existing policies. To assess the political sustainability of SAPs this paper uses social accounting matrices for three African countries to model the income effects of stylized SAPs on different socioeconomic groups. The analysis reveals wide variation in the likelihood for typical SAPs to be acceptable to political elites while generating growth in the rest of the economy. The presence of a rural elite or strong farm-nonfarm linkages can enhance the political sustainability of SAPs.     

Structural adjustment: A survey of the issues and options

The article raises and attempts to answer questions such as: adjustment for what purpose? to what shocks? of what factors or forces? by whom? who loses and who benefits from adjustment? and adjustment how? It also discusses the question of adjustment when? The distinction between external and internal shocks is rejected as neither helpful for the allocation of blame nor for the justification of raising finance. An analysis of the impact on the poor is sketched out. After a brief discussion of the role of the market and government intervention in adjustment policy and the fallacy of aggregating country policies, there follows a discussion of the double paradox of conditionality: why should a donor impose conditions that are in the best interest of the recipient, and why, instead of paying for getting good advice, is the recipient rewarded with extra money? Ten possible reasons are given. The paper ends with proposals as to how to overcome the conflict between national sovereignty and assuring that donor money is well spent.     

Eastern Germany and the conflict between wage adjustment,investment, and employment: A numerical analysis

Eastern Germany and the Conflict between Wage Adjustment, Investment, and Employment: A Numerical Analysis. — In this paper, some light is shed on the dynamics of the adjustment process in eastern Germany by studying the linkages between the dynamics of wage adjustment, investment, and employment. An extended dynamic investment model, which includes adjustment costs for capital and revision costs for investment, is presented. This model is specified according to the east German economy and analyzed numerically by an optimization method based on direct collocation. Results are obtained for the time horizon of adjustment and for the implications of different wage strategies on the path of investment and employment.     

Nominal shocks and the current account: A structural VAR analysis of 14 OECD countries

This paper provides some empirical evidence on one of the most controversial theoretical implications of the new open economy literature, which refers to the role of the current account in the international monetary transmission mechanism. In order to throw some light on this issue, two structural VAR models are estimated separately for 14 industrialized countries. The main empirical results highlight the importance of the role of nominal disturbances for current account fluctuations. Additionally, it is found that expansionary nominal shocks generate temporary current account surpluses, whose size is positively correlated with the openness of the individual countries. JEL no. C32, E40, F41, F42     

The Marshall Plan and the Spanish postwar economy: a welfare loss analysis1

This article uses historical fact as a natural experiment to measure a country's welfare loss from shifting from an allowed to a restricted trade situation, based on international trade theory. A welfare loss of 8 per cent of GDP is found. The evolution of domestic import and export prices in Spain in 1940–58 fits international trade theory assumptions. The main years of autarky are not those commonly considered, but 1947–55, marked by the exclusion of Spain from the Marshall Plan and the Madrid Treaty between Franco's regime and the US. The upper‐bound welfare loss for 1947–55 is 26 per cent of GDP.     

Maphephethe rural electrification (photovoltaic) programme: The constraints on the adoption of solar home systems

It has been recognised that off-grid energy technologies are essential if the rural population of South Africa is to be provided with basic electrical supply. This article documents the development process followed during a pilot programme aiming to investigate the introduction of solar (photovoltaic) systems as an alternative means of rural electrification. The community of Maphephethe in KwaZulu-Natal was targeted for the project. This article seeks to share the experiences, both positive and negative, that have been gained since the project commenced in 1996. A model for technology transfer and local capacity-building is proposed and certain issues are highlighted, including the slow dissemination of solar systems and the difficulties of financing in a poor rural community.     

Oil price shocks and the current account: An analysis of short run adjustment measures

Zusammenfassung ?lpreisschocks und Leistungsbilanz: Eine Analyse der kurzfristigen AnpassungsmaΒnahmen. — Der Aufsatz befa?t sich mit einer groΒen Gruppe von Entwicklungsl?ndern, die kein Roh?l f?rdern und die zur Finanzierung ihrer Leistungsbilanzdefizite haupts?chlich auf internationale Beh?rden oder eigene Reserven angewiesen sind. Unglücklicherweise hatten viele dieser L?nder bereits eine schwache Reserveposition, als die letzte Welle von ?lpreiserh?hungen begann, was auf den ?lpreisschock von 1973/74 und die anschlieΒende weltweite Rezession zurückzuführen ist. Deshalb verwenden wir hier ein Modell, in dem keine Kapitalmobilit?t, aber feste Wechselkurse vorausgesetzt werden. AuΒerdem wird angenommen, daΒ das betreffende Land für importierte Fertigwaren Preisnehmer ist, dagegen auf seinem Exportmarkt eine gewisse Monopolstellung besitzt. Untersucht werden die Auswirkungen eines ?lpreisschocks auf Produktion, Preise, Investitionen und Leistungsbilanz, auΒerdem verschiedene MaΒnahmen zur Anpassung der Leistungsbilanz (Geld-, Wechselkurs- und Handelspolitik) sowohl unter der Annahme flexibler als auch starrer Reall?hne.

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Résumé Chocs de prix pétrolier et la balance des paiements courants: une analyse des mesures d’ajustements à court terme. — L’article s’occupe d’un grand nombre des PVD non-pétrole qui principalement dépendent d’agences officielles ou de leurs réserves comme source de financer des déficits dans leurs balances des paiements courants. Malheureusement, beaucoup de ces pays avaient eu peu de réserves au commencement de la période récente des chocs de prix pétrolier comme résultat des événements de 1973/74 et de la suivante récession mondiale. En conséquence, l’auteur ne suppose aucune mobilité de capital, mais un régime des taux de change fixes. Il suppose de plus que le pays ne peut pas influencer le prix pour les produits finis importés, mais qu’il a quelque pouvoir de monopole sur ses marchés d’exportations. Les conséquences directes d’un choc de prix pétrolier sur la production, les prix, l’investissement et la balance des paiements courants sont analysés aussi bien que plusieurs mesures d’ajuster cette balance (la politique monétaire et commerciale et la politique du taux de change) en supposant que des salaires réels soient flexibles ou rigides.

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Resumen Shocks de precios del petroleo y la cuenta corriente: un análisis de medidas de ajuste de corto plazo. — El artfculo se ocupa de un amplio grupo de paises en desarrollo no productores de petróleo que dependen de agencias oficiales o rèservas propias como fuente de financiamiento para dèficits de cuenta corriente. Desafortunadamente, muchos de estos paises ingresaron al periodo corriente de shocks del petroleo con una dèbil posici?n de rèservas, como resultado de los acontecimientos de 1973/74 y la recesión mundial sobreviniente. Por lo tanto, en el modelo nosotros suponemos que no hay movilidad de capital, pero un règimen cambiario fijo, y que el pais adopta los precios en el mercado de bienes finales importados, pero tiene algún poder monopólico en su mercado de exportación. Se analizan los efectos de impacto de un shock del petróleo sobre el producto, precios, inversiones y cuenta corriente como tambièn varias medidas de ajuste de cuenta corriente (politica monetaria, politica cambiaria y polftica comercial) bajo el supuesto de salarios reaies flexibles y rigidos.

     

A knightian model for the analysis of structural adjustments by firms

Zusammenfassung Ein Knightsches Modell für die Analyse struktureller Anpassungender Unternehmen. — In mancher Hinsicht weicht die in diesem Aufsatz ge?uΒerte Ansicht über die Probleme der Unternehmen erheblich von der Auffassung ab, die normalerweise in vielen L?ndern vertreten wird. Erstens: Es gibt keine Problem-Industrien, sondern nur Problem-Unternehmen. Zweitens: Die Produktion vieler Unternehmen stammt aus zwei oder mehreren Industriezweigen. Deshalb haben Schocks für die einzelnen Unternehmen mehr oder weniger ernste Folgen, die davon abh?ngen, wie groΒ der Gewinnanteil ist, der in den einzelnen Industriezweigen erzielt wird. Drittens: Das Modell hebt hervor, daΒ die langfristige Gewinnerwartung der Unternehmen mehr von deren F?higkeit abh?ngt, die Verluste nach Marktst?rungen zu minimieren und die Gewinne in günstigen Marktsituationen zu maximieren, als von deren statischen kostenbedingten Wettbewerbsf?higkeit — gemessen als Stückkosten bei der Produktion eines unver?nderlichen Bündels von Erzeugnissen. Eine wichtige Folgerung aus diesen Unterschieden zwischen den Unternehmen ist, daΒ sich Firmen oft deshalb in sehr ernsten Schwierigkeiten befinden, weil sie nicht so leicht auf Marktver?nderungen reagierten wie ihre Konkurrenten. Wenn die relativ langsame Reaktion auf eine gr?Βere Risikoscheu oder auf ein weniger vorausschauendes Management zurückzuführen ist, dann besteht keine Veranlassung für Staatliehe Subventionen. Das Modell macht auch deutlich, wie verschiedene Unternehmungen unterschiedlich auf die Hilfe einer Regierung reagieren, wenn sich diese zu intervenieren entschlieΒt.

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Résumé Un modèle Knightien pour l’analyse des ajustements structurels par des entreprises. — En vue de quelques aspects fondamentaux l’opinion sur les problèmes des entreprises dans cet article est très différente de l’opinion communément exprimée dans beaucoup de pays. Premièrement, il n’y a pas des industries de problème, seulement des entreprises de problème. Deuxièmement, la production des entreprises comprise souvent des produits de deux ou plusieurs industries. C’est pourquoi des chocs ont plus ou moins sérieuses conséquences pour des entreprises individuelles qui, d’autres facteurs restant constants, dépendent de la part des bénéfices totaux qui dérive des biens produits dans les branches ébranlées. Troisièmement, le modèle de l’entreprise souligne que sa rentabilité de long terme pourrait dépendre plus de sa capabilité de minimiser la perte des bénéfices due aux perturbations du marché négatives et de maximiser le gain dú aux chocs favorables que de sa capacité concurrentielle statique des frais en terme des coúts moyens d’un assortiment fixe. Une implication importante de ces différences inter-entreprises est que les entreprises peuvent rencontrer des difficultés très graves parce qu’elles ne répondaient pas si vite aux fluctuations du marché que leurs concurrents. Si cette réponse relativement lente se dérive d’une aversion de risque plus grande ou d’un management moins perceptif il n’y a pas une justification pour une assistance gouvernementale. Le modèle aussi illustre comment les entreprises différentes peuvent répondre différement á l’assistance gouvernementale si le gouvernement se décide á intervenir.

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Resumen Un modelo de Knight para el análisis de ajustes estructurales en las empresas. — En varios aspectos fundamentales de este trabajo el enfoque sobre los problemas de las empresas difiere considerablemente del punto de vista compartido en gran numéro de paises. En primer lugar, no existen industrias con problemas, sino más bien, empresas con problemas. En segundo, la producción de muchas empresas cruza dos o más industrias. Esto ocasiona que ?shocks? tengan consequencias más o menos sérias para empresas concretas según la parte de los beneficios totales derivados de las mercaderias afectadas. Tercero, el modelo hace resaltar que el beneficio a largo plazo de la empresa, puede depender más de su habilidad para minimizar la pérdida de beneficios ocasionada por ?shocks? adversos en el mercado y para maximizar el beneficio debido a ?shocks? favorables, que de la competividad estática en costes de la empresa; estos Ultimos considerados en el sentido de costes unitarios en la producción de un surtido fijo de mercaderias. Una consequencia importante de estas différencias entre empresas es que la posible causa de que algunas empresas atraviesen una situación muy dificil sea el que no hayan reaccionado tan rápidamente como sus competidores trente a cambios en las condiciones del mercado. La ayuda estatal no esta justificada cuando esta reacción relativamente lenta es debida a una actitud precavida frente al riesgo, o a una direccion menos perceptiva que otras. El modelo pone también de manifesto, como diferentes empresas pueden reaccionar de diversa forma ante la ayuda del gobierno.

     

Successful SMEs in South Africa: The case of clothing producers in the Witwatersrand

The objective in this article is to examine the key determinants of successful SME development in post-apartheid South Africa. The determinants of successful SME growth are investigated by concentrating upon one specific branch of manufacturing, namely clothing production in the Witwatersrand. The article unfolds through four sets of material. First, a review is undertaken of research concerning the factors influencing successful SMEs in sub-Saharan Africa. Major themes are the elements of successful individual enterprise, successful clusters of enterprises and of available research in South Africa. In section two, attention turns to the case study and outlines key features of the development of the South African clothing industry. Section three presents the findings from 27 detailed interviews conducted with successful clothing producers in the Witwatersrand. Overall, it is concluded that the South African research confirms certain of the findings relating to trajectories of successful SME development in other parts of Africa.