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Submitted by Manoel Bittencourt on
Thanks for your reply Sandeep, 1. exactly, the initial condition matters in this case, SA has come a long way, however it is still a relatively closed society, not only in terms of goods, but also in terms of ideas (the debates we watch on TV illustrate the role of ideas). 2. the discussion of inclusive growth is only meaningful if something else is (are) happening at the same time, which in this case is education (supply and demand for human capital). 3. this is more about semantics, the truth is that the economy cannot absorb more domestic cleaners and gardeners, we all know that growth is an avalanche of things happening, and one of those things is increased demand and supply of human capital, which is not moving fast enough in SA at the moment. 4. investment matters, the USSR had a lot of it and it collapsed, technology is the main driver, and it requires human capital (the human capital story again). 5. That we don´t know, FDI is low perhaps because it is difficult to get into SA (role and quality of bureacracy perhaps), or perhaps FDI needs human capital in place, or perhaps the country is not open enough, or perhaps of lack of competition (which leads to your political economy story), or perhaps because there is no economic activity after 6pm, or perhaps because there is no reliable public transport, or perhaps all those things are interconnected, who knows?. 6. I am sure we are all talking about the same things, and I am sure we know how an economy which grows fast behaves (or how come the miracle of 1978 in China, 1991 in India and 1995 in Brazil happened), and SA does not behave as such. Best, Manoel.