Measuring the Interdependence between Economic Growth and Human Development in South Africa
This paper measures the interdependent between economic growth and human development in South Africa. Objective. Therefore the objective of this paper is to examine if interdependence exists between economic growth represented by GDP and the variables of human development (life expectancy, standard of living and education). Prior work. This paper is inclined on the theory of economic welfare, which advocates the measuring of economic growth by including the wellbeing of all and not to concentrate on GDP alone which is somewhat asymmetry. Approach. Data on South Africa’s economic growth and human development index were collected from the World Bank archives of economic indicators and from the United Nations Development Programme. Data were analysed using the vector auto-regression (VAR) and the Granger causality Wald tests. Results: Findings show that economic growth in South Africa is dependent on the achievement of human development variables namely health or life expectancy, standard of living or GNI and education. Implications: provides insight toward improving the constituents of human development to ensure a combination of economic growth and wellbeing; the paper provides a teaching case for the academia. Value. Based on the causality results, this paper contributes by providing a model for further research.
Barr, N. (2020). Economics of the welfare state. Oxford: Oxford University Press.
Binder, C. & Robeyns, I. (2019). Economic ethics and the capability approach. The Oxford Handbook of Ethics and Economics. Oxford: Oxford University Press
Bleys, B. (2012). Beyond GDP: Classifying alternative measures for progress. Social Indicators Research, 109(3), pp. 355-376.
Brys, B.; Perret, S.; Thomas, A. & O’Reilly, P. (2016). Tax design for inclusive economic growth. Retrieved from https://www. researchgate.net/profile/Bert_Brys/publication/311807836_Tax_design_for_Inclusive_Economic_Growth/links/585ba12c08ae329d61f2a2a8. pdf, date: 03. 18. 2020.
Coscieme, L.; Mortensen, L. F.; Anderson, S.; Ward, J.; Donohue, I. & Sutton, P. C. (2019). Going beyond Gross Domestic Product as an indicator to bring coherence to the sustainable development goals. Journal of Cleaner Production, 119232, https://doi. org/10. 1016/j. jclepro. 2019. 119232.
Ghosh, M. (2006). Economic growth and human development in Indian states. Economic and Political Weekly, 41(30), pp. 3321-3329.
Hanushek, E. A. & Woessmann, L. (2020). Education, knowledge capital, and economic growth. In The Economics of Education (pp. 171-182). Academic Press, Retrieved from https://www. Sciencedirect. Com/science/article/pii/B9780128153918000148, date: 03. 18. 2020.
Hundenborn, J.; Woolard, I. & Jellema, J. (2019). The effect of top incomes on inequality in South Africa. International Tax and Public Finance, 26(5), pp. 1018-1047.
Ioan, C. A. (2015). A new approach to utility function. Acta Universitatis Danubius. Oeconomica, 11(2), pp. 194-222.
Kalimeris, P.; Bithas, K.; Richardson, C. & Nijkamp, P. (2020). Hidden linkages between resources and economy: A Beyond-GDP approach using alternative welfare indicators. Ecological Economics, p. 169, 106508.
Khan, R. & Chaudhry, I. S. (2019). Impact of human capital on employment and economic growth in developing countries. Review of Economics and Development Studies, 5(3), pp. 487-496.
Laditka, S. B.; Laditka, J. N. & Gunn, L. (2019). Association of Attitudes with Economic Well-Being and Health: A Foundation for Public Policy. Innovation in Aging, 3 (Supplement_1), S125-S125.
Ioan, C. A. (2016). An equilibrium model for the Romanian economy. Journal of Accounting and Management, 6(2), pp. 42 – 75.
Ioan, C. A. & Ioan, G. (2013). An analysis on the net export dependence relative to GDP and the consumer demand for Romania during 2001-2011. EuroEconomica, 4(31), pp. 98– 105.
Nawatmi, S.; Nusantara, A. & Santosa, A. B. (2020). Determinants of Regional Economics Growth. Media Ekonomi dan Manajemen, 35(1), pp. 52-60.
Pesaran, M. H.; Shin, Y. & Smith, R. J. (1999). Bounds Testing Approaches to the Analysis of Long-run Relationships. Cambridge Working Papers in Economics 9907. Faculty of Economics. University of Cambridge.
Rahman, R. A.; Raja, M. A. & Ryan, C. (2020). The Impact of Human Development on Economic Growth: A Panel Data Approach. Available at SSRN. http://dx. doi. org/10. 2139/ssrn. 3526909.
Rahmawati, F. & Intan, M. N. (2020). Government Spending, Gross Domestic Product, Human Development Index (Evidence from East Java Province). KnE Social Sciences, pp. 774-786.
Ranis, G. (2004). Human development and economic growth. Yale University Economic Growth Center Discussion Paper, (887). Retrieved from http://www. econ. yale. edu/growth_pdf/cdp887. pdf, date: 03. 15. 2020.
Ranis, G.; Stewart, F. & Ramirez, A. (2000). Economic growth and human development. World Development, 28(2), pp. 197-219
Raynolds, L. T. (2002). Poverty alleviation through participation in Fair Trade coffee networks: Existing research and critical issues (No. Folleto 1101. ). New York: Ford Foundation.
Srivastava, S. & Talwar, S. (2020). Decrypting the Dependency Relationship between The Triad Of Foreign Direct Investment, Economic Growth and Human Development. The Journal of Developing Areas, 54(2). https://doi. org/10. 1353/jda. 2020. 0012.
UNDP (2020). Human development index. Retrieved from http://hdr. Undp. Org/en/content/human-development-index-hdi, date: 03. 25. 2020.
Vellala, P. S.; Madala, M. & Chhattopadhyay, U. (2014). A theoretical model for inclusive economic growth in Indian Context. International Journal of Humanities and Social Science, 4(13), pp. 229-235.
Copyright (c) 2020 Collins C. Ngwakwe
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
The author fully assumes the content originality and the holograph signature makes him responsible in case of trial.