Stuck in Low GEAR? Macroeconomic Policy in South Africa, 1996-1998

John Weeks ()
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John Weeks: Department of Development Studies, SOAS University of London, UK

No 85, Working Papers from Department of Economics, SOAS University of London, UK

Abstract: Despite its ideology while in opposition, once in power the ANC government implemented an orthodox macroeconomic policy which stressed deficit reduction and a tight monetary policy, combined with trade liberalisation. The stated purpose of this package (the Growth, Employment, and Redistribution programme, socalled GEAR) was to increase economic growth, with a 4.2 rate programmed for 1996-2000. At mid-term of the programme, growth remained far below this target. The GEAR’s lack of success cannot be explained by unfavourable external factors; rather, the disappointing performance seemed the result of fiscal contraction and excessively high interest rates.

Pages: 26 pages
Date: 1999-11
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Citations: View citations in EconPapers (3)

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