The impact of portfolio investment on economic growth in South Africa
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Date
2015-01
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University of Fort Hare
Abstract
The main objective of this study was to investigate the impact of foreign portfolio investment on economic growth in South Africa. South Africa, just like other several developing
countries has recorded large capital inflows in recent years, reversing a trend of outflows. Much of this new capital inflow has been in the form of portfolio investment. This has been
attributed to large domestic capital markets in South Africa. This surge in portfolio flows has raised the question whether these flows will be sustained or will instead be reversed in the
near future. Some observers argue that the recent flows are inherently unsustainable because in many cases they have short maturities. In light of this, this study, then, sought to establish the impact of portfolio investment on economic growth in South Africa. The study used annual data from 1990 to 2012. The data was tested for stationarity using the Phillips Perron and Augmented Dickey- Fuller tests. This was followed by cointegration, after which the vector error correction modelling was carried out.
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SOCIAL SCIENCES::Business and economics
Citation
Tenderere,M.(2015).The impact of portfolio investment on economic growth in South Africa.Alice: University of Fort Hare