There is a wide literature on the dynamic adjustment of employment and its relationship with the business cycle. Our aim is to propose a statistical model that offers a congruent representation of post-war UK labour market. We use a cointegrated vector autoregressive Markov-switching model where...

We introduce a reduced rank technique for testing for common deterministic shifts. The reduced rank approach is analysed also in the context of super exogenity and an alternative test for super-exogenity is proposed. One important advantage of this approach is that departing from the...

South Africa’s recent adoption of inflation targeting increases the need for good forecasting models of inflation and models for understanding the monetary transmission mechanism. This paper presents multi-step models for inflation and output, four-quarters ahead. The inflation model has...

South Africa experienced substantial rises in the ratios of consumption and household debt to income from 1983, for which conventional explanations in terms of income, income expectations, interest rates and wealth prove inadequate. This paper emphasizes the role of substantial financial...

Because of transportation costs, African manufacturing firms benefit from some market power on their domestic market, where they can charge a higher price than the export price, net of transportation cost. We present a simple theoretical model of an exporting firm that discriminates between the...

In an environment in which both buyers and sellers can undertake match specific investments, the presence of market competition for matches may solve hold-up and coordination problems generated by the absence of complete contingent contracts. In particular, this paper shows that when matching is...

Parental attitudes regarding the value of education may determine whether some, none or all school – aged children in a household are enrolled and how much formal education they will eventually complete. To the extent that attitudes are important and can be adequately measured,...

Schooling has been shown to provide substantial externality benefits by increasing farm output and shifting the production frontier outwards. This paper investigates the role of schooling at the household- and site-levels in the adoption and diffusion of agricultural innovations in rural...

Commodity export price uncertainty is typically measured as the standard deviation of the terms of trade, but this approach encounters at least three objections. First, terms of trade indices are unsuitable as proxies for commodity price movements per se. Secondly, the shortness of terms of...

Broadly and narrowly measured unemployment rates differ very markedly in certain countries, and the measure chosen to be the ‘official’ unemployment rate affects perceptions about the extent of the problem. The appropriate measure of the unemployment rate depends on...