© 2019

Accelerated Land Reform, Mining, Growth, Unemployment and Inequality in South Africa

A Case for Bold Supply Side Policy Interventions


Table of contents

  1. Front Matter
    Pages i-lxii
  2. Nombulelo Gumata, Eliphas Ndou
    Pages 1-41
  3. The Interaction Between Nominal Wage Inflation, Consumer Price Inflation and the Exchange Rate Appreciation and Depreciation Episodes and their Influence on Output Costs Associated with Disinflation

  4. An Evaluation of the Performance of the Current Inflation Targeting Framework in South Africa and Whether Nominal GDP Growth Targeting is a Viable Alternative

  5. The Output-Employment Intensities and the Structural Change Indices

  6. Policy Uncertainty, Mining Sector Charter, Exchange Rate Volatility, Commodity Price Booms and Busts, Binding Minimum Wage Increases and the Mining Sector

About this book


The overarching goal of South Africa’s National Development Plan (NDP) is to eliminate poverty, reduce inequality, lower unemployment and increase the labour participation.This book contributes to academic and policy efforts to achieve these NDP goals. We establish that the coal, metal ores and the platinum group commodity sectors will underpin the mining as a “sunrise” industry. The export-led growth strategy is necessary for intensive employment creation but must be complemented by other micro, macroeconomic and industrial policies. A strategy of minerals beneficiation is important for intensive employment creation. Accelerated land reform is a supply side or structural reform policy intervention tool aimed at increasing potential output, changing ownership patterns in the economy, increasing entrepreneurship, labour absorption, economic inclusion and lowering income inequality. Evidence shows that the balance sheet channel, commodity price booms and busts are intricately linked with the exchange rate dynamics, policy uncertainty, confidence and the effects of droughts (also symptoms of climate change). Productivity and investment growth shocks matter for output, employment and price stability. Evidence indicates that nominal GDP growth above 10 percent and keeping inflation within the target band leads to significant increase in employment and decline in unemployment, without inflationary pressures, especially when inflation is below 4.5 percent. To operationalise the NDP targets, align and co-ordinate policies, the South African Reserve Bank (SARB) mandate can be expanded to include maximum employment. This must be complemented by lowering the inflation target band, adjusting the financial regulatory, macro-prudential and monetary policy frameworks. This will enhance the conduct and credibility of monetary and financial stability policies to achieve the set objectives. These objectives make policy co-ordination pertinent and binding.


BRICS GDP growth shocks Foreign economic growth uncertainty South African GDP growth Equity flows Monetary policy tightening shocks Federal funds rate Repo rate South African labor market conditions Output growth volatility Taylor curve Expansionary monetary policy Output-employment-unemployment nexus in South Africa Okun’s Law Wage growth Wage and consumer price inflation Exchange rate appreciation and depreciation Inflation Aggregate demand shocks Export-led growth Commodity price booms

Authors and affiliations

  1. 1.South African Reserve BankPretoriaSouth Africa
  2. 2.South African Reserve BankPretoriaSouth Africa

About the authors

Nombulelo Gumata is an economist and has co-authored several books in the areas of international finance and macroeconomics, macro-prudential tools and financial stability, labour, monetary and fiscal policy.

Eliphas Ndou is an economist at the SARB and has authored books which cover areas in international finance, macroeconomics, microeconomics, monetary, labour and public economics, time-series econometrics, banking regulation and macro-prudential policy. 

Bibliographic information