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Does training benefit those who do not get any? Elasticities of complementarity and factor price in South Africa

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  • Alberto Behar

Abstract

Commentators claim that a shortage of skills in South Africa is constraining output and that a rise in skill supply would benefit less skilled occupations. This assumes or implies skilled and unskilled labour are complements. Hicks Elasticities of Complementarity and elasticities of factor price are estimated between capital and five occupations. The results show that skilled/artisanal and unskilled labour are complements while semi-skilled and unskilled labour are substitutes. These results allow for imperfectly elastic product demand, rigid wages and inference on highly non-linear elasticities. Aggregated estimates suggest More skilled labour complements Less skilled labour.

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Bibliographic Info

Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 244.

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Date of creation: 01 Aug 2005
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Handle: RePEc:oxf:wpaper:244

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Keywords: Hicks Elasticity of Complementarity; South Africa; Training; Skill;

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Cited by:
  1. Sparrow, G.N. & Ortmann, Gerald F. & Lyne, Michael C. & Darroch, Mark A.G., 2008. "Determinants of the demand for regular farm labour in South Africa, 1960-2002," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 47(1), March.
  2. Elie Appelbaum, 1996. "Import Price Uncertainty and the Distribution of Income," Working Papers 1996_10, York University, Department of Economics.

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