Aggregate Public-Private Remuneration Patterns in South Africa

Andreas Wörgötter () and Sihle Nomdebevana
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Sihle Nomdebevana: South African Reserve Bank

Atlantic Economic Journal, 2020, vol. 48, issue 4, No 6, 474 pages

Abstract: Abstract This paper investigates the public-private remuneration patterns in South Africa with time-series methods for the first time since the introduction of an inflation-targeting framework in 2000. Co-integration tests and analysis confirm that there is a stable, long-run relationship between nominal and real remuneration in the public and private sector. The adjustment to the deviations from this long-run relationship is strong and significant for public-sector remuneration, while private-sector wages neither respond to deviations from the long-run relationship nor lagged changes in public-sector remuneration. The causal direction from private- to public-sector remuneration does not change if real earnings are calculated with the gross domestic product deflator. This is confirmed by simple Granger-causality tests.

Keywords: South Africa; Remuneration pattern; Public sector earnings; Private sector earnings; Co-integration; Granger causality; Dutch disease; C32; E64; J31 (search for similar items in EconPapers)
Date: 2020
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Working Paper: Aggregate publicprivate remuneration patterns in South Africa (2018)
Working Paper: Aggregate publicprivate remuneration patterns in South Africa (2018)
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DOI: 10.1007/s11293-020-09684-0

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