2008 Commissioners Indaba 19 – 21 st November 2008 Sun City, North West Province Pro-Poor Economic...
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Transcript of 2008 Commissioners Indaba 19 – 21 st November 2008 Sun City, North West Province Pro-Poor Economic...
2008 Commissioners Indaba
19 – 21st November 2008Sun City, North West Province
Pro-Poor Economic Growth and the Labour Market in South
Africa: Exploring the InteractionsHaroon Bhorat
Introduction
Release of New Data, Enables a 10-year Overview
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Consistent Positive Economic Growth post-1994
BUT what has the Impact been on Poverty & Inequality
Evidence from 1995 – 2000: No Major Shifts in Poverty Levels, but Increase in Inequality
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Category Headcount Rate Poverty Gap Ratio
Year 1995 2005 1995 2005
R322 a month poverty line
African 63.04% 56.34% 31.86% 24.44%
Coloured 39.00% 34.19% 14.66% 12.98%
Asian 4.71% 8.43% 1.03% 2.17%
White 0.53% 0.38% 0.22% 0.11%
Total 52.54% 47.99% 26.04% 20.61%
R174 a month poverty line
African 38.18% 27.15% 14.71% 8.55%
Coloured 14.62% 12.30% 4.09% 3.88%
Asian 0.82% 1.60% 0.14% 1.07%
White 0.23% 0.01% 0.09% 0.00%
Total 30.92% 22.68% 11.77% 7.15%
Poverty shifts by race
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Share in population & poverty
1995 2005
Population Share
R322 Poverty Line
R174 Poverty Line
Population Share
R322 Poverty Line
R174 Poverty Line
Race
African 77.28% 92.74% 95.45% 79.40% 93.22% 95.05%
Coloured 9.31% 6.92% 4.40% 8.79% 6.26% 4.77%
Asian 2.61% 0.23% 0.07% 2.48% 0.44% 0.18%
White 10.79% 0.11% 0.08% 9.23% 0.07% 0.00%
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Poverty shifts by gender of household head
Category Headcount Rate Poverty Gap Ratio
Year 1995 2005 1995 2005
R322 a month poverty line
Male 45.83% 38.34% 22.22% 16.02%
Female 65.65% 60.57% 33.52% 26.59%
Total 52.54% 47.99% 26.04% 20.61%
R174 a month poverty line
Male 26.12% 17.10% 9.79% 5.38%
Female 40.31% 29.93% 15.63% 9.46%
Total 30.92% 22.68% 11.77% 7.15%
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Poverty shifts without poverty lines: Cumulative distribution functions (cdf) South africa
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Cumulative distribution functions (cdf) Gender of hh head
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Shifts in inequality: gini coefficients
Category 1995 2005
African 0.55 0.56
Coloured 0.49 0.58
Asian 0.45 0.53
White 0.39 0.45
Total 0.64 0.69
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Inequality within and between groups (using the theil index)
1995 2005
By Race
Within-group component 0.433 0.511
(53.15%) (50.35%)
Between-group component 0.381 0.504
(46.85%) (49.65%)
Total Inequality (Theil-T) 0.814 1.014
(100%) (100%)
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Growth incidence curve for South Africa: 1995 - 2005
67
89
10
11
An
nual
per
cap
gro
wth
in e
xpen
ditu
re
0 20 40 60 80 100Poorest p% ranked by per cap expenditure
Growth Incidence Curve Growth rate in mean
Mean of growth rates
Source:Statistics South Africa,1995 and 2005 & own calculations
Growth Incidence Curve for South Africa: 1995-2005
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Per capita grant income as share of Total wage and grant income 1999 and 2005
0
200
400
600
800
1000
1200
1400
1600
1800
1 2 3 4 5 6 7 8 9
deciles
0
10
20
30
40
50
60
70
80
90
100
mean monthly per capita grant +wage income 1999
mean monthly per capita grant + wage income 2005
share of per capita grant income in per capita grant + wage income 1999
share of per capita grant income in per capita grant + wage income 2005
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Access rates of state transfers inSouth Africa, 1995 - 2005
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Elasticities of poverty measures for South africa
Poverty Growth Elasticity Measure:
Poverty Inequality Elasticity:
Marginal Proportional Rate of Substitution (MPRS):
% change in poverty due to 1 % growth in pc expenditure
distribution neutral
% change in poverty due to 1 % increase in the Gini
increase in mean expenditure required to mitigate against increasing inequality (1% increase in Gini
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Elasticities of poverty measures For South Africa
Category R322 Poverty Line R174 Poverty Line
Year 1995 2005 1995 2005
P1-Mean Expenditure Elasticity -1.02 -1.33 -1.63 -2.17
P1-Gini Elasticity 3.79 6.30 9.96 17.05
MPRS: P1 3.72 4.74 6.12 7.86
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Datt-Ravallion Decompositions: 1995 - 2005
CategoryGrowth Component
Redistribution Component
Total Change in Poverty
Poverty Line R322 per month
Total -28.7 24.1 -4.50
African -29.7 23 -6.7
Coloured -34.6 29.8 -4.8
Asian -11.9 15.6 3.7
White -2.90 2.80 -0.20
Poverty Line R174 per month
Total -30.30 22.10 -8.20
African -32.80 21.80 -11.00
Coloured -25.80 23.50 -2.30
Asian -5.50 6.30 0.80
White -1.10 0.90 -0.20
2008 COMMISSIONERS INDABA 19 - 21 November 2008 Sun City
Conclusions
Statistically significant decline in poverty: race, gender of HH head, location
Increase in inequality -> driven by inequality between race groups
Absolute pro-poor growth but not relative pro-poor growth