ECONOMICS Harvard Case Solution & Analysis

Economics Case Solution

Question 1 Evaluate the five macroeconomic objectives referred to in the scenario and South Africa's current performance in each objective.


South Africa is considered as one of the world’s fastest growing nation in terms of their political since 1994. However, the economy of South Africa in terms of employment and the economic growth has been declining. The unemployment rate at South Africa is one of the worse in the world. The reason for the unemployment in South Africa is due to its inability to utilize its resources and generate jobs and increase wage levels. The economic growth of South Africa is also due to its inability of utilizing of the resources.

However, the low economic growth resulted in a decrease in the non-mineral trade. The lack of South Africa’s policy in order to avail the opportunity from the exports so as to generate new jobs and to increase economic growth. The analysis by Rodrik (2008) that resulted in a decline in these two macro economics was due to the decline in the profitability of the manufacturing sector in South Africa in the 1990, which was considered as the most critical contributor to the economy. (Rodrik, 2008)

Like any other country, South Africa has also set its macroeconomics objectives, which the country tends to achieve in order to increase the prosperity of the country. Reduction of inequality in the Economy, Economic growth, Balance of Payments, Price Stability and Full employment are the five macroeconomics objectives of the South Africa. The achievement of these out comes is not as easy as expected to be with trade-offs. (Affairs, 2005)

Levin (2004) has collected different information on the attainability of the macroeconomic objectives. The researcher has analyzed the effect of the adaptation of these macroeconomics objectives on the development of the economy. The main focus of the research was the forecasting of the inflation and the adaptation of different forecasting techniques in the different sectors. There is a difference between the roles of the inflation in forecasting methods adapt by the private sector as compared to the state owned companies. The research came up with the findings in favor of clear inflation objectives which would lead to major economic development. (Levin, Natalucci, & Piger, 2004)

The fulfillment of the macroeconomics objectives is important for South Africa in order to improve the living standards of the people living in South Africa. The economy of South Africa has been observed to have a number of opportunities to accomplish its macroeconomics objectives. In order to achieve the macroeconomic objective, they have to adapt and attain a number of microeconomics reforms, which will help them to get closer to the accomplishment of the major macroeconomic goal.Economics Case Solution

South Africa is categorized as a developing state due to its fast paced economic growth due to the intervention in the economic development process of the Country. However, different authors and analysts have different perspective on South Africa being a developing state. (Padayachee, 2006) The growth of the GDP was observed from the year 1990 to 1993 and it was -0.4%, however it improved in year 1994 to 2.8%till the year 2003. (reporter, 2014)

Economic Growth

The economic growth of the company is often related to the Gross Domestic Product of the Country. However, it includes a number of objectives relative to the total production. It was previously mentioned in the report that the GDP of South Africa is at a growing trend. Nonetheless, the real per capital growth has been 1% since the year 1994. However, it has been observed that the real GDP growth in the year 1996 was 4.2% and the year 2000 witnessed the real GDP growth at 3.1%.....................

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