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Can progressive macroeconomic policy address growth and employment while reducing inequality in South Africa?

Published online by Cambridge University Press:  01 January 2023

Vishnu Padayachee
Vishnu Padayachee*
Affiliation:
University of the Witwatersrand, Johannesburg, South Africa
*
Vishnu Padayachee, School of Economic and Business Sciences, University of the Witwatersrand, Johannesburg, 1 Jan Smuts Avenue, Braamfontein 2000, Johannesburg 2001, Gauteng, South Africa. Email: vishnu.padayachee@wits.ac.za
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Abstract

This article aims to set out some progressive, mainly post-Keynesian, macroeconomic policy ideas for debate and further research in the context of macroeconomic challenges faced by South Africa today. Despite some successes, including at reducing poverty, the South African economy has been characterised by low growth, rising unemployment and increasing inequality, which together with rampant corruption and governance failures combine to threaten the very core of the country’s stability and democracy. The neo-liberal economic policies that the African National Congress–led government surprisingly adopted in 1996 in order to assuage global markets sceptical of its historical support for dirigiste economic policy, have simply not worked. Appropriate progressive macroeconomic interventions are urgently needed to head off the looming prospect of a failed state in the country which Nelson Mandela led to democracy after his release from prison in February 1990. What happens in Africa’s southern tip should still matter for progressives all around the world. The article draws on both history and theory to demonstrate the roots of such progressive heterodox economic thinking and support for a more carefully coordinated activist state-led macroeconomic policy, both in general terms and in the South African context. It shows that such approaches to growth and development – far from being populist – also have a rich history and respectable theoretical pedigree behind them and are worthy of inclusion in the South African policy debate.

Keywords

E12Economies in transitionfiscal consolidationglobal southinequalitypost-apartheid South Africapost-Keynesian economicsSouth Africa
Type
Post-crisis rebuilding: national perspectives
Information
The Economic and Labour Relations Review , Volume 30 , Issue 1: Symposia: Post-Crisis Rebuilding: Job Quality, Job Security and the Law , March 2019 , pp. 3 - 21
Copyright
© The Author(s) 2019

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