Essays on public finance and environmental economics in Namibia

Abstract: This thesis comprises two papers exploring aspects of public finance and environmental economics in Namibia.Paper [I] estimates the shadow prices of capital, labour and foreign exchange for the Namibian economy. The results suggest that the shadow price of capital for Namibia is 8%. The economic costs of Namibian labour, as a share of financial costs, are 32% for urban semi- and unskilled labour, and 54% for rural semi- and unskilled labour. The economic cost of foreign labour as a share of financial costs is 59%. The estimated range for the shadow exchange rate factor is between 7% and 14% for the Namibian economy.Paper [II] studies the determinants of property prices in the township areas of Windhoek, the capital of Namibia. The study reveals that properties located close to an environmental hazard, such as a garbage dump, sell at considerable discounts. On the other hand properties located near an environmentally favourable location, such as recreational open space, sell at a premium. These results provide evidence of the importance of environmental quality in lower income property markets in developing countries. It is therefore important for Namibian urban planners to incorporate environmental quality within the planning framework for lower income areas.