Dr C Jooste at the World Bank in Washington DC

What do the Ph.D. graduates from University of Pretoria do? They work in places that try to make a difference in reducing poverty and inequality by allocating resources in the most efficient way. Armed with the right technical skills and work experience, many of UP graduates join the public service and private sector ranks to work as technical advisors at central banks, treasuries, revenue authorities, trade and industry, academia and international institutions such as the World Bank Group and the International Monetary Fund. 

Charl Jooste is a recent Ph.D. graduate. Under the supervision of Professors Ruthira Naraidoo and Rangan Gupta, he completed his thesis on fiscal-macro linkages. Charl’s thesis analyses the effects of foresight and how fiscal shocks are discounted before they are enacted. The results indicate that with sufficient foresight, pre-announced and credible fiscal policy overturns Keynesian predictions about the role of fiscal stimulus. This result depends largely on the degree of foresight exhibited by rational agents and the size of credit-constrained consumption in the economy. The role of a financial intermediary leads to a similar result in overturning Keynesian effects whereby costly intermediation creates a wedge between different interest rates, acting as a borrowing constraint for both firms and households. In the only applied chapter, the thesis analyses the effects of uncertainty on sovereign defaults. Uncertainty can lead to self-fulfilling debt defaults even when fundamentals are normal. The role of uncertainty of debt default is nonlinear and depends on the actual size of debt. This result might account for the recent behavior of rating agency downgrades on South African debt.

Charl started his career working for IHS Global Insight in South Africa before moving to the National Treasury. He worked in the Modelling and Forecasting Division and was its Director in Revenue Modelling and Forecasting. Charl then moved to the World Bank Group in Washington D.C. where he is now a modeler in Macroeconomic and Fiscal Management Global Practice. He travels frequently around the world to train and build various models for Central Banks, Ministries of Finance and Ministries of Planning. Part of his responsibility is to maintain and develop the World Bank’s Global Models, including large-scale structural econometric models, Dynamic Stochastic General Equilibrium models and various micro-simulation models.

“I am very fortunate and feel very lucky to have worked with excellent lecturers and professors at the University of Pretoria. The Economics Program opened many doors for me. In addition to the first-rate program, I always felt encouraged by the enthusiasm and level of engagement in the Economics Faculty. You will have many opportunities to present and develop your ideas. You will also learn the practical value of applying theory in the public policy space, where technical rigor and a thorough understanding of theory is a necessity”.