chapter  4
4MODELLING FRAMEWORKS
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The macroeconomic perspectives of the South African economy are analysed in this volume using two modelling frameworks associated with, respectively, the International Monetary Fund (IMF) and the World Bank. Although both frameworks are relatively simple, they do illustrate the fundamental perceptions of macroeconomic caus­ ality that are implicit in the economic policy advice given by the two Bretton Woods institutions. Thus, while the framework of the IMF, known as Financial Programming (FP), puts emphasis on monetary factors in short-term economic stabilization, the Revised Minimum Standard Model (RMSM) of the World Bank is primarily focused on medium to long-term GDP growth and other real variables. Besides assessing the macroeconomic perspectives of the South African economy, this study is also aimed at reviewing these modelling tools through various applications.