Understanding the nexus between savings and economic growth: A South African context
Date
2021-05-28
Journal Title
Journal ISSN
Volume Title
Publisher
Taylor & Francis Group
Abstract
The study examines the relationship between savings and
economic growth in South Africa for the period 1986–2018. The
Johansen cointegration technique and the Vector Error Correction
Model were employed as methods of analysis. The findings from
the study indicate that the effect of savings on economic growth
in South Africa is negative . However, a positive relationship
between the two variables was established in the short-run.
Granger causality tests were also utilised to determine the
direction of causality between savings and economic growth. The
results revealed that the relationship runs from economic growth
to gross domestic savings. Another important observation from
the study is the role of investment which was found to have a
positive effect on economic growth. This result also supports the
idea of promoting investment if the country is to achieve
sustainable economic growth.
Description
CITATION: Bianca Flavia van Wyk & Forget Mingiri Kapingura (2021) Understanding the nexus between savings and economic growth: A South African context, Development Southern Africa, 38:(5):828-844, doi:10.1080/0376835X.2021.1932424
The original publication is available at: tandfonline.com
The original publication is available at: tandfonline.com
Keywords
Economic growth, Savings, Vector Error Correction, South Africa
Citation
Bianca Flavia van Wyk & Forget Mingiri Kapingura (2021) Understanding the nexus between savings and economic growth: A South African context, Development Southern Africa, 38:(5):828-844, doi:10.1080/0376835X.2021.1932424