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Nutrition and economic growth in South Africa: a threshold co-integration approach

Wisdom Dube (School of Physiology, Nutrition and Consumer Sciences, Faculty of Health Sciences, North West University, Potchefstroom, South Africa)
Andrew Phiri (School of Economics, Faculty of Economic and Management Sciences, North West University, Potchefstroom, South Africa)

Journal of Economic Studies

ISSN: 0144-3585

Article publication date: 12 January 2015

Abstract

Purpose

The purpose of this paper is to examine asymmetric co-integration effects between nutrition and economic growth for annual South African data from the period 1961-2013.

Design/methodology/approach

The authors deviate from the conventional assumption of linear co-integration and pragmatically incorporate asymmetric effects in the framework through a fusion of the momentum threshold autoregressive and threshold error correction (MTAR-TEC) model approaches, which essentially combines the adjustment asymmetry model of Enders and Silkos (2001); with causality analysis as introduced by Granger (1969); all encompassed by/within the threshold autoregressive (TAR) framework, a la Hansen (2000).

Findings

The findings obtained from the study uncover a number of interesting phenomena for the South Africa economy. First, in coherence with previous studies conducted for developing economies, the authors establish a positive relationship between nutrition and economic growth with an estimated income elasticity of nutritional intake of 0.15. Second, the authors find bi-direction causality between nutrition and economic growth with a stronger causal effect running from nutrition to economic growth. Lastly, the authors find that in the face of equilibrium shocks to the variables, policymakers are slow to responding to deviations of the variables from their co-integrated long run steady state equilibrium.

Originality/value

In the study, the authors make a novel contribution to the literature by exploring asymmetric modelling in the correlation between nutrition intake and economic growth for the exclusive case of South Africa.

Keywords

Citation

Dube, W. and Phiri, A. (2015), "Nutrition and economic growth in South Africa: a threshold co-integration approach", Journal of Economic Studies, Vol. 42 No. 1, pp. 138-156. https://doi.org/10.1108/JES-08-2013-0116

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited