Investment in South Africa

Driver, Ciaran; Harris, Laurence

Abstract

Abstract: Since the achievement of democracy, high levels of gross fixed capital formation have been required for the economic and social transformation of South Africa. Public-sector investment has risen, particularly since 2008, but private-business investment has not grown enough, while manufacturing’s share of the capital stock has declined substantially. Common explanations for low investment in manufacturing are examined in the light of empirical literature and are judged to have inadequate evidential support. Industrial policies derived from these views, such as maintaining low interest rates to promote investment, need to be based on stronger evidence. An argument is put forward for a system-based approach to research on the determinants of investment.

Citation

Driver, C., & Harris, L. Investment in South Africa. In A. Oqubay, F. Tregenna, & I. Valodia (Eds.), The Oxford Handbook of the South African Economy (441-466). Oxford University Press. https://doi.org/10.1093/oxfordhb/9780192894199.013.41

• Online Publication Date: Dec 1, 2021
• Deposit Date: Dec 13, 2021
• Publicly Available Date: Dec 31, 2021
• Publisher: Oxford University Press
• Pages: 441-466
• Book Title: The Oxford Handbook of the South African Economy
• ISBN: 9780192894199
• DOI: https://doi.org/10.1093/oxfordhb/9780192894199.013.41
• Keywords: gross fixed capital formation, public-sector investment, manufacturing sector, user cost of capital, uncertainty, concentration, crowding in, South Africa
• Related Public URLs: https://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780192894199.001.0001/oxfordhb-9780192894199-e-41?rskey=Bnf70s&result=11