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Prof
Kaseeram, Irrshad
Department: Economics
Research Interest(s): Development macroeconomics, Economics of entreprenuership, Microeconomics modelling, Macroeconomics modelling.
Active Research Project(s): Sustainable rural livelihoods through local economic development.
Sustainable rural livelihoods through entrepreneurship.
Active Community Engagement: Training the trainers project advising facilitators, as assisting to develop the scholarship of community engagement publications.
Biography: Prof Kaseeram joined the University of Zululand in 2003 as lecturer, was promoted to senior lecturer in 2013, associate Prof in 2015 and full Professor in 2020. He has successfully supervised 7 Doctoral and 19 Master’s graduates. Since 2011 he has been a HoD (Economics). Since 2014, he has served as a Deputy Dean Research and Internationalisation for the Faculty of Commerce Administration and Law.
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- The literature review highlights an ongoing debate regarding the effectiveness of inflation targeting (IT) in anchoring expectations, stabilizing output, reducing the inflation rate, and lowering the volatility and persistence of inflation. The study further argues that the perceived success of IT may represent nothing more than “conservative window dressing,” whereby interest rates are raised to maintain low inflation at the expense of output losses. Through three independent essays, this study contributes to the debate on the effectiveness of IT and the nature of conservative monetary policy. The first essay conducts a detailed econometric investigation into whether the inflation expectations of various market participants—namely financial analysts, business executives, and trade unionists—are anchored to the inflation target. If expectations are anchored, this implies that the central bank’s IT framework is viewed as credible (the credibility proposition). If not, the policy is deemed non-credible by economic agents. The Cruijsen and Demertzis (2010) vector autoregression framework is employed when the inflation and expectations data are stationary; however, for nonstationary data, as in South Africa’s case, Johansen’s (1991) cointegration and vector error correction modelling techniques are applied. The findings reveal that only financial analysts regard the South African Reserve Bank’s IT framework as credible, whereas business executives and trade unionists do not. The second essay examines whether inflation volatility and persistence have declined since the adoption of IT, given that IT is intended to anchor expectations around a target or band, thereby reducing these dynamics. Using GARCH, GARCH-M (in-mean), and AR(2) methodologies, the study evaluates South Africa’s performance in this regard. To avoid erroneous conclusions, the analysis incorporates structural break tests, including Bai and Perron (2003), Lee and Strazicich (2003), Andrews and Ploberger (1994), and Lumsdaine and Papell (1997). The results show no significant changes in inflation volatility or persistence between the pre- and post-IT periods. The third essay estimates forward-looking hybrid Taylor-type reaction functions using the General Method of Moments (GMM), following the methodologies of Clarida, Gertler and Gali (1998), Gerdesmeier and Roffia (2003), and Hayo and Hofmann (2005). The results indicate that during the IT period, South Africa pursued a conservative and predictable monetary policy, characterized by a high weighting on inflation reduction and relatively low weighting on output deviations when setting the repo rate. Additionally, the study compares the IT experiences of Chile, Brazil, and Turkey with that of South Africa. The findings suggest that although IT is effective across these countries in reducing inflation and supporting sustainable economic growth, questions remain regarding its effectiveness in anchoring inflation expectations, reducing volatility and persistence, and stabilizing output at its potential level. Overall, the synthesis of the three essays indicates that South African authorities have not fully succeeded in convincing price and wage setters that IT can credibly maintain inflation within the target band. As a result, inflation and inflation volatility persist. Moreover, the success of IT often depends on raising the repo rate to prevent second-round effects of supply shocks (e.g., oil price increases or currency depreciations), a policy stance that may undermine output stabilization and complicate the future transformation of monetary policy.
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- The search for happiness is a universal human goal. We all want to be happy and lead a flourishing life of endeavor with fruitful relationships, free from worries and afflictions. However, not all of us are happy, despite growth in personal income over time. Subjective well-being has traditionally been in the realm of philosophy, suggesting that happiness, as the only ultimate purpose of life, is underpinned by virtuosity and moral principles. In recent times, happiness has attracted the attention of economists and researchers in other disciplines too. Psychology indicates that certain personality attributes are critical for higher happiness levels. Economic reasoning suggests that rising incomes with economic growth and good health enhance quality of life and subjective well-being. This paper takes on an interdisciplinary exploratory approach to examining happiness. It examines the economic and non-economic influences on the human life satisfaction and assesses the role of government to enhance well-being and happiness. The paper introduces the philosophical influence of the mode of action, goodness as an alternative individual approach to a good life and lasting happiness, and complements this with a panel regression analysis, reflecting that rising income per head, freedom, healthy life expectancy conditions and income inequalities are significant economic factors influencing happiness in a society. For citizens’ higher happiness levels, policy-makers should therefore promote economic growth with which rising income per capita is associated, ensure good health care conditions and minimize income inequalities.
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- The relationship between trade and industrial performance has received a great deal of empirical attention over the past three decades. Much of this empirical attention has however focused on productivity, employment, and output growth oblivious of profit effects – the primary motive for manufacturers. Different from this literature, this paper contributes to the existing body of knowledge by testing the hypothesis that trade affects profit efficiency of manufacturing industries through its effect on technical and allocative efficiency. Using a panel stochastic frontier model based on 28 South African manufacturing industries observed between 1970 and 2016, evidence confirms a strong positive effect of export intensity on profit efficiency that operates mainly through technical efficiency. Import penetration appears to have improved allocative efficiency without having a discernible effect on profit efficiency. The former result lends empirical support to the long-standing view that outward-oriented policies have the potential to enhance industrial profit maximization while the latter result suggests that inward-oriented polices at worst promote suboptimal input allocation.
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- Purpose The primary purpose of the study is to analyse the asymmetric effects of public debt on economic growth, using secondary data over the period 1980–2018 in South Africa. Design/methodology/approach This study estimated a Smooth Transition Regression (STAR) and Nonlinear Autoregressive Distributed Lag (NARDL) approach, using time series data to analyse the asymmetric effect of public debt on economic growth in South Africa. Findings The findings revealed a significant nonlinear relationship between public debt and economic growth in South Africa. The results showed an inverted U-Shape relationship, implying a significant positive influence of public debt on economic growth during the low-debt regime. While during a high-debt regime, public debt exerted a significant negative effect on economic growth. The study proposes that policymakers ought to consider targeting a sustainable debt threshold that would enhance efficient use of public finances consistent with long-term economic prosperity. Originality/value This paper asymmetries and threshold effects between public debt and economic growth in South Africa, through the application of dynamic nonlinear models namely, Smooth Transition Regression (STAR) and Nonlinear Autoregressive Distributed Lag (NARDL) approach. Studies on the relationship under examination have predominantly been confined in advanced economies. This study provides rigorous empirical evidence from the South African perspective.
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- Purpose This study aims to interrogate dynamic asymmetric relationships between public debt and economic growth in Southern African Developing Communities (SADC), over the period 2000–2018. Design/methodology/approach The study employed a panel smooth transition regression (PSTR) technique to analyse dynamic asymmetric relationships between public debt and economic growth, and the threshold effect at which public debt hampers economic growth. Findings The findings indicate that there is a significant nonlinear effect of debt on economic growth in SADC. The study discovered a debt threshold of 60% to GDP at which debt beyond this threshold deteriorates long-term growth. The low-debt regime was found to be positive and statistically significant, while the high-debt regime is detrimental for long-term growth. Fiscal policymakers ought to consider the adoption of well-coordinated debt policies that aims to strike a balance between sustainable public debt and economic growth, within a reasonable threshold target. Originality/value The study focusses on asymmetric and threshold analysis of public debt on economic growth in SADC using sophisticated panel smooth transition regression (STAR). This study provides rigorous empirical evidence within the SADC perspective in which previous studies have predominantly been confined in advanced economies.
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- This study estimates a Panel Vector Autoregressive (PVAR) approach to analyse the impact of fiscal policy and public debt on economic growth in Southern African Developing Communities (SADC). The study further estimated the fixed effects (FE) and random effects (RE) to verify the robustness of empirical findings. The results provide rigorous empirical evidence of a positive response of GDP growth due to shocks in government expenditure, employment, and public debt while gross capital formation exerts a negative effect on economic growth. The study proposes that fiscal authorities ought to focus on the adoption of prudent fiscal policies as a credible stabilization tool at the disposal of policymakers to safeguard stable and yet productive public finances consistent with sustainable economic prosperity. These may include addressing infrastructural development, soaring fiscal deficit, creation of jobs, and creating a conducive environment for both labour and capital- intensive projects to flourish in the SADC economies.
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- This study interrogates asymmetric effect of public debt on economic growth among selected emerging and frontier SADC economies. The study estimates a smooth transition regression (STAR) to analyse asymmetric relationship between public debt and economic growth using time series data from 2000 to 2018, extracted from the World Development Indicators. The findings indicate a strong evidence of a significant asymmetric relationship between public debt and growth among emerging and frontier SADC members under consideration. The results revealed the inverted U-Shape effect of public debt on growth in South Africa. While the results for Botswana, Namibia, Zambia and Zimbabwe indicate that there is a U-Shape relationship between public debt and economic growth. The study suggest that policymakers ought to consider curbing public debt level within a sustainable threshold target in order to reduce accompanying debt serving costs, and efficiently use public finances consistent with sustainable economic expansion.
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- From 1990 to 2019, this study examines the nonlinear dynamic impact of financial development on income inequality in an unconventional policy regime in a panel of 21 African countries. More importantly, we use Panel Smooth Transition Regression to extend the existing debate on this subject, with roots back to the seminal work of G-J and many others, and add a twist by distinguishing between a conventional (1990–1999) and unconventional policy regime (2000–2019), as well as the threshold level at which financial development reduces inequality. Our baseline results will be supported by the Generalized Method of Moments. The PSTR model was chosen because it can account for features that dynamic panel techniques cannot, such as endogeneity, homogeneity, cross-country variability, and time instability within the model. We found evidence of a non-linear effect between the two variables, with the threshold found to be 21.90% of GDP, below which financial development reduces inequality in Africa, and this confirms the U-shape in unconventional policy regimes and the G-J in conventional policy regimes. Unconventional monetary policies were found to trigger the financial-inequality relationships. The focal policy recommendation is that the financial sector be given adequate consideration and recognition by, inter alia, implementing appropriate financial reforms, developing an adequate investment strategy, and maintaining spending on science and technology investment in African countries below the threshold. Again, when implementing unconventional monetary policies in African countries, extreme caution is required.
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- This study employs the panel vector autoregressive (PVAR) model to examine the spillover effect of US unconventional monetary policy on inflation and non-inflation targeting emerging markets post credit crunch and during COVID-19 from 2000Q1 to 2020Q4. Unlike other analyses, this paper adds to the existing body of knowledge by employing a dummy variable to represent the United States’ quantitative easing. Other included control variables are equity prices, the federal reserve rate, the exchange rate, central bank assets and the short-term interest rate. This paper estimated two-panel VARs, Model one and Model two, for inflation and non-inflation targeting emerging markets, respectively. Model one consists of eight inflation-targeting markets, and Model two consists of four non-inflation-targeting countries. Other included control variables are equity prices, the federal reserve rate, the nominal effective exchange rate, and the central bank policy rate. According to the empirical results, the US unconventional monetary policy induces a surge in the exchange rate and a decrease in the central bank policy rate for both inflation and non-inflation targeting emerging markets. However, there was no significant impact on the equity prices. The empirical results are statistically significant, robust, and consistent with previous studies except for the response of equity prices. Unconventional monetary policy is effective in steering macroeconomic variables in developed economies. The monetary policymakers in emerging markets must also use the currency reserve to stabilise the macroeconomic variables in response to US unconventional monetary policy shocks.
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