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Measuring Poverty in South Africa

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  • Ingrid Woolard
  • Murray Leibbrandt

    ()
    (Southern Africa Labour and Development Research Unit, University of Cape Town)

Abstract

This paper sets out the methodological issues for the measurement of poverty before presenting a poverty profile of South Africa. It tests the sensitivity of the poverty profile to choices around the metric used to measure well-being, the equivalence scale used and the level of the poverty line. The key finding is that the defining features of South African poverty are so pronounced that the profile of poverty is robust to changes in the underlying measurement assumptions. Gauteng, South Africa's economic powerhouse, has long been dependent on immigration to supply its labour requirements, a phenomenon deeply rooted in the provinces early economic history and the development of mining and heavy industry. Although migration has contributed to the development of the province, it also poses challenges to the provincial government partly through the added burden on state-financed services and programmes. In this context, this study aims to quantify and describe migration to and migrant labour in Gauteng by using the 2001 Census and the September 2002 Labour Force Survey. South African immigrants to the province (or in-migrants) were defined in one of two ways: individuals who were born in South Africa, but outside of Gauteng, or individuals whose most recent move in the 1996-2001 period was to Gauteng from one of the other eight provinces. In-migrants are described in terms of their demographics and educational and employment status. Further, in-migrants access to public services including electricity and water and other indicators of their living standards, such as housing, were analysed. As far as possible, the analysis compared in-migrants to non-migrants and intra-Gauteng migrants in order to provide insight into special benefits or challenges that in-migrant households may present. The Labour Force Survey module on migrant labour allowed the profiling of migrant labourers and the approximation of economic links between Gauteng and other provinces as represented by remittances. The study found that a large proportion of Gauteng residents were born outside the province, or moved into the province in the inter-census period, indicating a relatively mobile population. Although in-migrants constitute approximately half of the population with post-matric qualifications, they are overall less educated than the rest of the Gauteng population and are more often engaged in relatively lower skilled occupations and sectors. It is concluded that significant levels of in-migration are likely to continue for at least the medium-term, with in-migrants posing important challenges specifically in the areas of health, housing and infrastructure provision. Through remittances, the economic situation of the province and of migrant workers may also have important consequences in the rural areas of the provinces of Limpopo, Eastern Cape, KwaZulu-Natal and Mpumalanga

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Bibliographic Info

Paper provided by University of Cape Town, Development Policy Research Unit in its series Working Papers with number 99033.

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Length: 45 pages
Date of creation: Oct 1999
Date of revision:
Publication status: Published in Working Paper Series by the Development Policy Research Unit, October 1999, pages 1-45
Handle: RePEc:ctw:wpaper:99033

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Keywords: South Africa: migrant labour; Gauteng; poverty line;

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References

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  1. Callan, Tim & Nolan, Brian, 1991. " Concepts of Poverty and the Poverty Line," Journal of Economic Surveys, Wiley Blackwell, vol. 5(3), pages 243-61.
  2. J. L. Nicholson, 1976. "Appraisal Of Different Methods Of Estimating Equivalence Scales And Their Results," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 22(1), pages 1-11, 03.
  3. Haddad, Lawrence & Kanbur, Ravi, 1989. "How serious is the neglect of intrahousehold inequality ?," Policy Research Working Paper Series 296, The World Bank.
  4. Hentschel, J. & Lanjouw, P., 1996. "Constructing an Indicator of Consumption for the Analysis of Poverty. Principles and Illustrations with Reference to Ecuador," Papers 127, World Bank - Living Standards Measurement.
  5. Christopher T. & Brian Nolan, 1996. "The Relationship Between Income and Deprivation : A Dynamic Perspective," Revue économique, Presses de Sciences-Po, vol. 0(3), pages 709-717.
  6. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762.
  7. Foster, James E & Shorrocks, Anthony F, 1988. "Poverty Orderings," Econometrica, Econometric Society, vol. 56(1), pages 173-77, January.
  8. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-31, March.
  9. Lanjouw, Peter & Ravallion, Martin, 1995. "Poverty and Household Size," Economic Journal, Royal Economic Society, vol. 105(433), pages 1415-34, November.
  10. Nelson, Julie A, 1988. "Household Economies of Scale in Consumption: Theory and Evidence," Econometrica, Econometric Society, vol. 56(6), pages 1301-14, November.
  11. Foster, James E. & Shorrocks, Anthony F., 1988. "Inequality and poverty orderings," European Economic Review, Elsevier, vol. 32(2-3), pages 654-661, March.
  12. Ravallion, M., 1992. "Poverty Comparisons - A Guide to Concepts and Methods," Papers 88, World Bank - Living Standards Measurement.
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Citations

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Cited by:
  1. Alex Sienaert, 2008. "Some Child Cost Estimates for South Africa," Economics Series Working Papers WPS/2008-15, University of Oxford, Department of Economics.
  2. Gray, B.C. & Lyne, Michael C. & Ferrer, Stuart R.D., 2005. "Criteria to monitor the poverty alleviation, empowerment and institutional performance of equity-share schemes in South African agriculture," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 44(4), December.
  3. Pauw, Kalie, 2005. "Quantifying the Economic Divide in South African Agriculture: An Income-Side Analysis," Working Paper Series 15630, PROVIDE Project.
  4. Sabina Alkire and Maria Emma Santos, 2010. "Acute Multidimensional Poverty: A New Index for Developing Countries," OPHI Working Papers ophiwp038, Queen Elizabeth House, University of Oxford.
  5. Paula Armstrong & Bongisa Lekezwa & Krige Siebrits, 2008. "Poverty in South Africa: A profile based on recent household surveys," Working Papers 04/2008, Stellenbosch University, Department of Economics.
  6. Gazi Salah Uddin & Phouphet Kyophilavong & Nasim Sydee, 2012. "The Casual Nexus of Banking Sector Development and Poverty Reduction in Bangladesh," International Journal of Economics and Financial Issues, Econjournals, vol. 2(3), pages 304-311.
  7. Thurlow, James, 2006. "Has trade liberalization in South Africa affected men and women differently?:," DSGD discussion papers 36, International Food Policy Research Institute (IFPRI).
  8. Alex Sienaert, 2008. "Some Child Cost Estimates for South Africa," CSAE Working Paper Series 2008-15, Centre for the Study of African Economies, University of Oxford.
  9. Frederick C.v.N. Fourie, 2011. "The South African unemployment debate: three worlds, three discourses?," SALDRU Working Papers 63, Southern Africa Labour and Development Research Unit, University of Cape Town.
  10. Sten Dieden, 2003. "Integration into the South African Core Economy: Household Level Covariates," SALDRU/CSSR Working Papers 054, Southern Africa Labour and Development Research Unit, University of Cape Town.
  11. Judith Streak & Derek Yu & Servaas Van der Berg, 2009. "Measuring Child Poverty in South Africa: Sensitivity to the Choice of Equivalence Scale and an Updated Profile," Social Indicators Research, Springer, vol. 94(2), pages 183-201, November.
  12. Morné Oosthuizen & Liezl Nieuwoudt, 2002. "A poverty profile of the Western Cape province of South Africa," Working Papers 03/2002, Stellenbosch University, Department of Economics.
  13. Derek Yu & Sihaam Nieftagodien, 2007. "Poverty and Migration: Evidence from the Khayelitsha/Mitchell's Plain Area," SALDRU Working Papers 11, Southern Africa Labour and Development Research Unit, University of Cape Town.
  14. Abdelhafidh Dhrifi, 2013. "Financial Development and Poverty: What Role for Growth and Inequality?," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 3(4), pages 119-129, October.
  15. Odhiambo, Nicholas M., 2009. "Finance-growth-poverty nexus in South Africa: A dynamic causality linkage," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(2), pages 320-325, March.

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