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Derivatives and Economic Growth in South Africa: Lessons for Kenya
Kenya is now at advanced stages of introducing a derivatives market. Its aim is to enhance Kenya’s medium-term growth prospects as outlined in the capital markets master plan 2014- 2023. This study interrogates the effect of derivatives on economic growth and growth volatility, learning from the Sou...
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| Format: | Thesis |
| Language: | English |
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School of Economics
2020
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| _version_ | 1867613182820876288 |
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| access_status_str | Open Access |
| author | Mulei, Mutava Michael |
| author2 | Abraham, Haim |
| author_browse | Abraham, Haim Mulei, Mutava Michael |
| author_facet | Abraham, Haim Mulei, Mutava Michael |
| author_sort | Mulei, Mutava Michael |
| collection | Thesis |
| description | Kenya is now at advanced stages of introducing a derivatives market. Its aim is to enhance Kenya’s medium-term growth prospects as outlined in the capital markets master plan 2014- 2023. This study interrogates the effect of derivatives on economic growth and growth volatility, learning from the South African experience. The study also identifies some of the factors that drove South Africa’s implementation of derivatives as a development tool - Some countries have enacted legislation for it yet have never transitioned to successful operations. The study paints a picture of the current global and regional view of derivatives and examines empirical evidence from previous studies. Using a GMM approach, the study finds no significant relationship between trading derivatives and economic growth in South Africa. Thereafter, economic growth volatility is modelled using the GARCH method and the effects of derivatives on that volatility are tested. No effect is found. The study finds that the derivative market in South Africa is not yet sufficiently developed to benefit the economy. Finally, the relationship between economic development and derivatives is appraised using a Granger causality test: this suggests that development tends to engender the evolution of derivatives in the long run. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/31049 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:32:05.102Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2020 |
| publishDateRange | 2020 |
| publishDateSort | 2020 |
| publisher | School of Economics |
| publisherStr | School of Economics |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/31049 Derivatives and Economic Growth in South Africa: Lessons for Kenya Mulei, Mutava Michael Abraham, Haim Mateane, Lebogang Applied Economics Kenya is now at advanced stages of introducing a derivatives market. Its aim is to enhance Kenya’s medium-term growth prospects as outlined in the capital markets master plan 2014- 2023. This study interrogates the effect of derivatives on economic growth and growth volatility, learning from the South African experience. The study also identifies some of the factors that drove South Africa’s implementation of derivatives as a development tool - Some countries have enacted legislation for it yet have never transitioned to successful operations. The study paints a picture of the current global and regional view of derivatives and examines empirical evidence from previous studies. Using a GMM approach, the study finds no significant relationship between trading derivatives and economic growth in South Africa. Thereafter, economic growth volatility is modelled using the GARCH method and the effects of derivatives on that volatility are tested. No effect is found. The study finds that the derivative market in South Africa is not yet sufficiently developed to benefit the economy. Finally, the relationship between economic development and derivatives is appraised using a Granger causality test: this suggests that development tends to engender the evolution of derivatives in the long run. 2020-02-12T13:06:13Z 2020-02-12T13:06:13Z 2019 2020-02-12T12:07:45Z Master Thesis Masters MCom http://hdl.handle.net/11427/31049 eng application/pdf School of Economics Faculty of Commerce |
| spellingShingle | Applied Economics Mulei, Mutava Michael Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| thesis_degree_str | Master's |
| title | Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| title_full | Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| title_fullStr | Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| title_full_unstemmed | Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| title_short | Derivatives and Economic Growth in South Africa: Lessons for Kenya |
| title_sort | derivatives and economic growth in south africa lessons for kenya |
| topic | Applied Economics |
| url | http://hdl.handle.net/11427/31049 |
| work_keys_str_mv | AT muleimutavamichael derivativesandeconomicgrowthinsouthafricalessonsforkenya |