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Does South African Affirmative Action Policy Reduce Poverty? a CGE Analysis

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Author Info
Hélène Maisonnave
Bernard Decaluwé
Margaret Chitiga

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Abstract

This paper presents a computable general equilibrium model (CGEM) able to measure the impacts of the affirmative action policy set up in South Africa. In order to decrease inequalities inherited from the former regime, the government encourages firms to employ Historically Disadvantaged Persons (HDP). Through this study, we evaluate the impact of this policy on employment, poverty and inequality. To evaluate impacts on poverty and inequality, we use a CGE Top Down approach. The paper analyses two scenarios; the first one deals with the impact of affirmative action on skilled jobs. The second scenario adds to the previous by including semi skilled workers in the simulation. Both of these scenarios show a deep decrease in unemployment as well as a fall of poverty for each population groups.

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Paper provided by CIRPEE in its series Cahiers de recherche with number 0936.

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Date of creation: 2009
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Handle: RePEc:lvl:lacicr:0936

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Related research
Keywords: Computable General Equilibrium Model; Top Down Analysis; South Africa; Poverty; Inequality; Labor Market;

Find related papers by JEL classification:
D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
E27 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation
I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty
O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
O55 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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References listed on IDEAS
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  1. David G. Blanchflower & Andrew J. Oswald, 1995. "The Wage Curve," MIT Press Books, The MIT Press, edition 1, volume 1, number 026202375x.
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  2. Blanchflower, David G & Oswald, Andrew J, 1995. "An Introduction to the Wage Curve," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 153-67, Summer. [Downloadable!] (restricted)
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This page was last updated on 2009-11-19.


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