OECD Social, Employment and Migration Working Papers

ISSN :
1815-199X (online)
DOI :
10.1787/1815199x
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This series is designed to make available to a wider readership selected labour market, social policy and migration studies prepared for use within the OECD. Authorship is usually collective, but principal writers are named. The papers are generally available only in their original language - English or French - with a summary in the other.
 

Trends in South African Income Distribution and Poverty since the Fall of Apartheid You or your institution have access to this content

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Author(s):
Murray Leibbrandt1, Ingrid Woolard1, Arden Finn1, Jonathan Argent1
Author Affiliations
  • 1: University of Cape Town, South Africa

Publication Date
28 May 2010
Bibliographic information
No.:
101
Pages
91
DOI
10.1787/5kmms0t7p1ms-en

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This report presents a detailed analysis of changes in both poverty and inequality since the fall of Apartheid, and the potential drivers of such developments. Use is made of national survey data from 1993, 2000 and 2008. These data show that South Africa’s high aggregate level of income inequality increased between 1993 and 2008. The same is true of inequality within each of South Africa’s four major racial groups. Income poverty has fallen slightly in the aggregate but it persists at acute levels for the African and Coloured racial groups. Poverty in urban areas has increased. There have been continual improvements in non-monetary well-being (for example, access to piped water, electricity and formal housing) over the entire post-Apartheid period up to 2008. From a policy point of view it is important to flag the fact that intra-African inequality and poverty trends increasingly dominate aggregate inequality and poverty in South Africa. Race-based redistribution may become less effective over time relative to policies addressing increasing inequality within each racial group and especially within the African group. Rising inequality within the labourmarket – due both to rising unemployment and rising earnings inequality – lies behind rising levels of aggregate inequality. These labour market trends have prevented the labour market from playing a positive role in poverty alleviation. Social assistance grants (mainly the child support grant, the disability grant and the old-age pension) alter the levels of inequality only marginally but have been crucial in reducing poverty among the poorest households. There are still a large number of families that are ineligible for grants because of the lack of appropriate documents. This suggests that there is an important role for the Department of Home Affairs in easing the process of vital registration.
JEL Classification:
  • D31: Microeconomics / Distribution / Personal Income, Wealth, and Their Distributions
  • I32: Health, Education, and Welfare / Welfare and Poverty / Measurement and Analysis of Poverty
  • I38: Health, Education, and Welfare / Welfare and Poverty / Government Policy; Provision and Effects of Welfare Programs