Open AccessThe relative contribution of alternative capital flows to South Africa: An empirical investigation
Author(s) -
Omolola Oluwatoyin Adeola,
Meshach Aziakpono
Publication year - 2017
Publication title -
journal of economic and financial sciences
Language(s) - English
Resource type - Journals
eISSN - 2312-2803
pISSN - 1995-7076
DOI - 10.4102/jef.v10i1.4
Subject(s) - economics , capital flows , capital (architecture) , investment (military) , developing country , capital deepening , endogeneity , order (exchange) , poverty , capital formation , development economics , financial capital , macroeconomics , economic growth , geography , market economy , human capital , econometrics , finance , liberalization , archaeology , politics , political science , law
The need for external capital flows to developing countries to supplement domestic savings for investment and growth cannot be over-emphasised, especially in Africa, where there are high levels of poverty and low domestic capacity to save. To achieve sustainable economic growth, countries require other sources of capital from outside the domestic economy. This study uses co-integration and error correction modelling techniques together with tests for weak exogeneity to analyse the effects of four major capital flows into South Africa. This is done for the period 1970 to 2012 in order to determine the relative contribution of these capital flows to South Africa