Economywide consequences of attaining Millenium Development Goals in South Africa

International audienceSouth Africa has committed to eliminate poverty and reduce inequality by 2030 in its National Development Plan. To realise this, it will be critical to make strides in attaining the Millennium Development Goals. This paper uses a computable general equilibrium model to show the complexities of trade-offs between attaining these goals and their financing. There are clear spillover benefits from attaining goals such as universal primary education, and combating HIV-AIDS that the model takes into account. The conclusions point to the need for weighing up merits of different policies against their cost

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Fiscal Space and Public Spending on Children in Burkina Faso

International audienceDespite experiencing high growth rates in recent decades, Burkina Faso remains a poor country. Poverty among children is particularly worrying, as it has long term (and often irreversible) effects on individuals. Furthermore, it can be transmitted from one generation to the next and significantly reduce economic growth. To address this issue requires fiscal and budgetary policies supporting health, education and improving the household economy. At the same time

The Impact of the Global Economic Crisis on Sub-National Government – Lessons from the Free State Province in South Africa

A provincial computable general equilibrium model for the Free State province in South Africa is used to quantify the channels by which the recent global economic crisis affects the province. The analysis allows focus on three levels through which provincial economies and their people are impacted by a global economic crisis, namely the macro-economic level, the meso-economic level and the micro-economic/household level. The novel features of the paper are mainly applying this methodology at sub national government level. The decrease in world prices combined with the drop in world demand lead to a fall in production for most sectors in the province. There is a negative impact on institutions, and households see their incomes drop. Though the crisis seems to be petering out now, there are lessons for intergovernmental financial relations that this paper has highlighted and long run effects of the crisis that the province needs to confront.Global crisis, Computable General Equilibrium

Does climate policy make the EU economy more resilient to oil price rises? A CGE analysis

The European Union has committed itself to reduce greenhouse gas (GHG) emissions by 20% in 2020 compared with 1990 levels. This paper investigates whether this policy has an additional benefit in terms of economic resilience by protecting the EU from the macroeconomic consequences due to an oil price rise. We use the GEM-E3 computable general equilibrium model to analyze the results of three scenarios. The first one refers to the impact of an increase in the oil price. The second scenario analyses the European climate policy and the third scenario analyses the oil price rise when the European climate policy is implemented. Unilateral EU climate policy imposes a cost on the EU of around 1.0% of GDP. An oil price rise in the presence of EU climate policy does impose an additional cost on the EU of 1.5% of GDP, but this is less than the 2.2% of GDP that the EU would lose from the oil price rise in the absence of climate policy. This is evidence that even unilateral climate policy does offer some economic protection for the EU.JRC.J.1-Economics of Climate Change, Energy and Transpor

The impact of the international economic crisis on child poverty in South Africa

This paper reports on a study to provide insights into the magnitude of the shocks associated with the recent global economic crisis in macroeconomic terms in South Africa, the country’s capacity to withstand or cushion these shocks, and the extent of fragility in terms of poverty levels and child wellbeing. The analysis combines macro-economic and micro-economic tools to assess the extent of the crisis’ impact on the country. The study finds that the poverty headcount ratio increases little in the moderate crisis scenario, but substantially under the severe scenario. However, under both scenarios there is a relatively successful return to close to the business as usual trend. It is important to note though that under both scenarios, more poverty sensitive measures (the poverty gap ratio and the poverty severity ratio) decline more, and remain in negative territory longer, showing that the major impact of the crisis is on the poorest, and that this impact is most difficult to overcome.ECONOMIC CRISIS, COMPUTABLE GENERAL EQUILIBRIUM, FORECASTING AND SIMULATION, ALMOST IDEAL DEMAND SYSTEMS, CHILD POVERTY MEASUREMENT, SOUTH AFRICA

Regional impact of the global economic crisis on the Free State province in South Africa : a computable general equilibrium (CGE) assessment

The decline in the world economy that followed the 2008-2009 global economic crisis had detrimental effects on most economies. Not enough attention has been paid to the process through which crisis-related pressures affected regional economies and sub-national governments. A regional computable general equilibrium model was developed to analyse impacts of the crisis on the regional economy of the Free State province in South Africa. Key results included a general fall in prices in the province, a fall in demand in sectors that are more vulnerable to global conditions, falling wages and declining incomes for agents and provincial governmenthttp://www.journals.co.za/content/journalam2016Economic