Dynamic Effects of Inflation and Interest Rate Risks on Stock Market Returns in Ghana: Exploring non-linearities

This study examines the dynamic impact of inflation and interest rate volatilities on stock market returns in Ghana. In both the constructed base linear and extended non-linear models, market returns have negatively autoregressive in the short-run. Also, interest rate risk has a slight direct effect in the base linear model in the same time period. However, at equilibrium for the said model, both risks influence returns. For the non-linear model, only interest rate volatility and the interaction between the two risks affect market returns in the long run. Possibly, market inefficiency inhibits explanatory power of the non-linear model. Keywords: error correction analysis, inflation volatility, interest rate risk, stock market returns JEL classification: C32, C57, E43, G32

Sub-Saharan Africa’s Financial Market Development Gap: A Human Capital Deficiency? (Decomposition of Banking, Financial Sector Intermediation and Stock Market Failures)

This study evaluates the influence of human capital on development of three elements of a financial market, namely: banks, financial sector intermediation to the private sector and stock markets, in Sub-Saharan Africa. The developed model is relatively innovative as it explicitly models financial market failures, includes a nonlinear variable and is underpinned by adaptive expectations. Tertiary education was found to be critical for banking, financial sector intermediation and stock market development. The study finds that, for the banking industry, past failures narrow current gaps. However, increased public expenditure on education is important for only financial sector intermediation and stock market development. Keywords: Financial markets, Human capital, Sub-Saharan Africa. JEL Classification: G10, O16, O55

Farmers' perceptions of climate variability, their adaptation strategies and agricultural productivity: a case of Limpopo province, South Africa

The provision of farm management decision support and advisory services to insure climate resilient agricultural production systems, especially for subsistence farmers, depends on data on such producers. The main objective of the paper was to generate such data by comparing the status quo regarding dryland, subsistence grain farmers' perceptions of climate variability, their adaptation strategies and crop productivity. Using a survey questionnaire, the comparison was made across time (2014 and 2017) in selected municipalities of Limpopo province. The findings across time and aggregated for all the different local municipalities investigated were similar regarding respondents' perceptions of climate variability, adaptation strategies used and crop productivity. The perceptions revealed that respondents were aware of the reality of climate variability and its negative effects on their crop and livestock production, Agricultural productivity amongst extension and non-extension recipients was low, with minimal differences. These findings auger well for the development of common strategies to improve the effectiveness of the support for farm management including climate variability that is provided by the public agricultural extension service to the group of producers in this study to reduce the negative effects of climate variability on their crop productivity. This will eventually help to improve their food security