Aumann (1976) derives his famous we cannot agree to disagree result under the assumption of rational Bayesian learning. Motivated by psychological evidence against this assumption, we develop formal models of optimistically, resp. pessimistically, biased Bayesian learning within the framework of...

Many analysts use band-pass filters to remove so-called permanent components from output and then study the remainder, which is then termed the "business cycle". Building on the critique of these deviation cycles by Harding and Pagan and on the recent work on the mediumterm persistence of...

Persistently high unemployment in South Africa, especially in the face of improved economic conditions since 1994, begs the question: Does unemployment in South Africa respond to changes in output? When considering the linkages between output and unemployment, it is useful to decompose...

This paper develops a stochastic model of grade repetition to analyze the large racial differences in progress through secondary school in South Africa. The model predicts that a larger stochastic component in the link between learning and measured performance will generate higher enrollment,...

Is there a Phillips curve relationship present in South Africa and if so, what form does it take? Traditionally the way to estimate the Phillips curve is merely to regress the change in the price level on a measure of the output gap (or the deviation of actual unemployment from the NAIRU)....

This paper presents an analysis of the interaction of human capital investment and the development of social and political institutions. We find that human capital matters - for growth through its quality dimension; for distributional conflict by raising political aspirations. But human capital...

The ability of the South African government to provide antiretroviral medication to those in need will be determined by the ability of the public health services sector to efficiently provide that medication. If the delivery of other health services can be used as a guide, the goals of the...

We examine a two country aid model with performance intensive aid. The aid budget is determined by a donor country legislature, but allocated by a donor agency in terms of a performance criterion of its choice. Five sources of slippage in policy delivery are introduced: the donor agency observes...

This paper studies the synchronization of economic variables between South Africa and the US. In addition it examines transmission channels through which supply and demand shocks from the US effect economic activity in South Africa. We use a structural dynamic factor model approach, instead of...

This paper shows that South Africa’s exports and imports had been determined by the normal variables found in gravity models, namely GDP, population and distance. However, differences in the composition of trade had resulted in distance from markets having a greater adverse effect on...