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AbstractThis paper examines the nature and sources of productivity growth in South African manufacturing sectors, from an international comparative perspective. On panel data estimations, we find that the evidence tends to support Schumpeterian explanations of productivity growth for a panel of countries including both developed and developing countries, and a panel of South African manufacturing sectors. By contrast, semi‐endogenous productivity growth is supported for a panel of OECD (Organisation for Economic Cooperation and Development) manufacturing sectors. However, we also report evidence that suggests that sectors are not homogeneous. For this reason, time series evidence may be more reliable than panel data. Time series evidence for South Africa suggests that prospects for the sustained productivity growth associated with Schumpeterian innovation processes, is restricted to a narrow set of sectors. For the OECD manufacturing sectors, both semi‐endogenous and Schumpeterian growth finds support. Schumpeterian growth is present for a larger number of sectors than for South Africa, and is most prevalent in the North American economies.

AbstractThis paper presents a test diagnostic that determines whether financial shocks are due to the propagation of idiosyncratic shocks originating in a single source country (or group of countries), or a reflection of market interdependence due to factors common across markets. The test is given by the ratio, λ, of the unconditional to the conditional correlation coefficient between markets. We demonstrate analytically that the test statistic is robust to heteroscedasticity due to conditional market volatility, to the impact of omitted variables (particularly important in the event that shocks may be transmitted between any two markets via a third 'intermediate' market) and to the impact of endogeneity between markets. Size and power characteristics of the test are strong. An application to the Asian financial crisis of 1997–1998, the subprime crisis of 2007 and the European crisis of 2009 demonstrates its empirical tractability. For the Asian and the subprime crises, the λ‐test suggests that propagation of shocks was predominantly due to common fundamentals: in the European crisis shock propagation by contrast is indicated to be due to idiosyncratic shocks centred on Cyprus, Greece and Latvia.

This article presents a new dataset of indicators of political freedom, property rights and political instability for Zimbabwe for the period 1946 to 2005. The dataset is constructed by systematically coding the three concepts of political freedom, property rights and political instability along a multitude of dimensions. The lengthy time coverage of the dataset allows country-specific econometric analysis to evaluate generalizing propositions about the effects of political institutions on economic outcomes. The dataset also contributes to the dynamic analysis of the effects of political institutions on conflict, a contentious issue in political science. Correlations between the new measures reveal that while political instability has a strong and negative relationship with property rights, it has no significant relationship with political freedom. The finding supports the notion that political conflict is significantly higher in the in-between category of semi-democracy than at either end of the democracy scale. The validity of the dataset is supported by its strong correlations with other conceptually and operationally different measures of political institutions. The new dataset has begun to be employed in country-specific time-series studies of the link between institutions and economic outcomes. Two core results are that property rights influence the volumes of foreign direct investment (FDI) in Zimbabwe and that negative spillover effects of poor institutional environments can occur between neighbouring countries. It is feasible to extend the geographical coverage of the dataset by applying our methodological framework to other countries.