Modelling South Africa’s Economic Transformation and Growth: A Prospective and Retrospective Analysis
Round 1
Reviewer 1 Report
Comments and Suggestions for Authors
The paper offers a methodologically rigorous and contextually comprehensive examination of South Africa's economic change and growth. The authors offer important perspectives on structural economic dynamics in an emerging market context by utilising the Transformation Adjusted Projection (TAP) model in both retrospective and prospective contexts. The incorporation of many policy-relevant scenarios improves the practical utility of the research, providing a definitive analytical framework for assessing the long-term impacts of differing reform intensities.
The conceptual framework is thoroughly established and suitably situated within the historical and institutional development of South Africa's economy. The technique is articulated with adequate clarity, encompassing the identification of essential variables and the rationale for their application in simulation. The results are systematically presented, and the conclusions derived are congruent with the empirical evidence.
However, the manuscript could benefit from refinement in certain aspects. Initially, although the language employed is largely comprehensible, the manuscript would gain from competent English language editing. Certain portions feature excessively lengthy and convoluted sentences, and the transitions between paragraphs may be enhanced to augment the overall coherence and clarity.
Secondly, the paper would benefit from a more detailed examination of the model's shortcomings. The authors might examine the model's ability to incorporate exogenous shocks, nonlinear effects, or the sensitivity of institutional factors to policy interventions. Mitigating these limits would enhance the strength and reliability of the technique.
Finally, although the paper is appropriately centred in the South African context, a brief connection to analogous modelling endeavours in other developing or emerging economies would enhance its scholarly appeal and situate the research within a broader framework of structural transformation literature.
In conclusion, the article provides a significant and expertly crafted contribution to the discipline of development economics. It can be published with minimal improvement in language and interpretive depth.
Comments on the Quality of English Language
The language is suitable for publication but needs enhancement for clarity. The phrases are lengthy and intricate, and the transitions between sections could be more fluid. A language editing service is advised.
Author Response
23 June 2025
Dear Reviewer 1, Economies
RE – ARTICLE RESUBMISSION: Modelling South Africa’s Economic Transformation and Growth: A Prospective and Retrospective Analysis – Manuscript ID 3697980
Thank you for the opportunity to revise and resubmit our paper mentioned above. We would like to thank you for the useful comments and suggestions. We have carefully considered your feedback provided and included in attachment a point-by-point report that outlines how we have addressed each of the comments you gave on our paper.
Thank you for your careful reading.
Best regards,
Authors
Author Response File: 
Author Response.pdf
Reviewer 2 Report
Comments and Suggestions for Authors
The article is well written although the following changes are necessary:
- Dependence on CGE Model without Model Restriction Consideration: This paper is based upon a recursive dynamic Computable General Equilibrium (CGE) model without sufficient regard for the model's prime restrictions. These consist of the lack of agent-level microdetail, inability to account for volatility in the financial sector or macroeconomic shocks, and static representation of technological change without reliance on fixed productivity parameters. These limitations compromise the explanatory power of the model in a case as intricate as that of South Africa. A strong, hybrid model framework—e.g., a synthesis of agent-based models or combined macro-micro simulations—would provide a greater and accurate understanding of economic transformation as well as labor dynamics in a number of sectors and classes of populations.
- Labor Market Segmentation Insufficiency in Addressing Informality: The paper recognizes labor market segmentation but insufficiently deals with the size and behavior of the informality sector in South Africa, which absorbs a large percentage of the labor force and is a source of livelihoods and a resilience in the economy. By not addressing the informal economy, the model fails to capture sectoral productivity differentials, labor absorption, and structural determinants driving inclusive growth. Incorporating a higher resolution understanding that includes informal-formal transitions in labor, wage elasticity differentials, and labor vulnerability would serve to enhance the realism, policy relevance, and capacity of the model to provide input in developing solutions for addressing inequality and employment.
- Limited Empirical Validation for Model Assumptions: The model relies on international productivity-investment elasticities, for instance, Fofana et al., with limited explicit empirical validation for the specific structure for the case of the South African economy. This diminishes the credibility of the model, with central parameters not being tightly calibrated with domestic and sectoral data. The model can distort the policy impacts, sectoral dynamics, and labor's reactions without strong sensitivity analyses and cross-validation by local dataset. Those assumptions that become inexact can end up decreasing the reliability of simulated results. Incorporating the empirical basis through localized testing and calibration in a variety of scenarios would make precision in the model as well as policy suggestions greater.
- Overgeneralization in Sectoral Growth Prospects: The sectors like personal services, transport, and finance that the report cites as having a leading role in curbing joblessness provide a very generic outlook for the sector's growth prospects. This fails to provide a qualitative picture involving the quality of employment, required skill levels, and geographical diversity in sector performance. This failure is interesting in that it is not realized that it is neglecting essential structural factors like geographical disparities, entry barriers in sectors, as well as proportions of informal or precarious jobs. In addition, the presumption that the sectors would be able to absorb full levels of well-educated workers is not taken into account in the presence of skill imbalances, city-country disparities, as well as possible wage polarization, that offer reduced scope for policy functionality.
- Lack of Considering Climate, Environmental, and Technology Disruption Factors: The paper does not consider vital determinants such as climate change, environmental resilience, and technology disruptions due to their rising contribution to industry evolution and employment trends. It does not include green transition dynamics, for instance, shifting towards low-carbon industries, green investment in renewable energy, as well as climate risks that weaken economic resilience. The model also does not include structural hindrances such as that of South Africa’s energy insecurity—represented by chronic Eskom power supply struggles—and disruptions such as that provided by technology, such as through automation, which is capable of restructuring labor markets and lowering the demand for low-skill employees. Including such factors in transformation models would add realism, future-proof policy-making as well as make economic planning align with sustainability and resilience imperatives.
- Limitation in Diversification in Policy Scenarios: The simulation framework for the study is limited by the fact that it is built on two scenarios alone: a business-as-usual (BAU) base and a single investment-led growth path. This limited diversity is susceptible to oversimplification in the dynamics between policy balancing and does not cover the entire economic spectrum that is expected with the variety of approaches to development. By not covering different fiscal, monetary, as well as trade policy scenarios like redistribution-oriented, austerity-bound, or export-oriented models for growth, the study is not provided with the flexibility that is necessary for decision-making that is nuanced. Increasing the diversity in the number of scenarios would provide stronger, comparative conclusions in the risks, benefits, and long-term behavior of various policy routes.
With the following changes you can orient your article for
Comments for author File: Comments.pdf
Author Response
23 June 2025
Dear Reviewer 2, Economies
RE – ARTICLE RESUBMISSION: Modelling South Africa’s Economic Transformation and Growth: A Prospective and Retrospective Analysis – Manuscript ID 3697980
Thank you for the opportunity to revise and resubmit our paper mentioned above. We would like to thank you for the useful comments and suggestions. We have carefully considered your feedback provided and included in attachment a point-by-point report that outlines how we have addressed each of the comments you gave on our paper.
Thank you for your careful reading.
Best regards,
Authors
Author Response File: Author Response.pdf
