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Effect of social infrastructure investment on economic growth and inequality in South Africa: a SEM approach

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  • Itumeleng More
  • Goodness C. Aye

Abstract

This paper investigates the effect of social infrastructure on economic growth and inequality in South Africa using a SEM approach. We use growth as the mediating variable while controlling for production factors, urbanisation and globalisation. Results show a positive and significant relationship between education expenditure and growth. However there is a negative but insignificant relationship between health expenditure and growth. Furthermore, results indicate a negative but insignificant relationship between education and inequality and a significant negative relationship between health and inequality. Consistent with the Kuznets theory, we find a positive and significant relationship between growth and inequality in South Africa.

Suggested Citation

  • Itumeleng More & Goodness C. Aye, 2017. "Effect of social infrastructure investment on economic growth and inequality in South Africa: a SEM approach," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 13(2), pages 95-109.
    • Handle: RePEc:ids:ijecbr:v:13:y:2017:i:2:p:95-109
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    Cited by:

    1. Kanayo Ogujiuba & Ntombifuthi Mngometulu, 2022. "Does Social Investment Influence Poverty and Economic Growth in South Africa: A Cointegration Analysis?," Economies, MDPI, vol. 10(9), pages 1-23, September.

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