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HIV/AIDS and Poverty in South Africa : A Bayesian Estimation

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  • Federica MARZO

    (Crest)

  • Fabrice MURTIN

    (Crest)

Abstract

In this paper we estimate the causal impact of HIV/AIDS on monetary poverty. Using a paneldatabase from South Africa, we model the consequences of illness on both labor income andtransfers. We treat endogeneity and selection problems associated to HIV/AIDS through using aselection model that includes correlated fixed-effects both in the level and the participationequations, which are estimated simultaneously via original Bayesian methods. While no significantimpact of HIV/AIDS on household labor income is found due to households recomposition, asignificant and asymmetric impact on income transfers emerges. For urban populations, we find thatHIV/AIDS has a positive impact on the probability of receiving social and private transfers, servingto marginally reduce poverty, while for rural populations, HIV/AIDS causes a substantial fall inreceived transfers and dramatically increases chronic poverty.

Suggested Citation

  • Federica MARZO & Fabrice MURTIN, 2009. "HIV/AIDS and Poverty in South Africa : A Bayesian Estimation," Working Papers 2009-12, Center for Research in Economics and Statistics.
  • Handle: RePEc:crs:wpaper:2009-12
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    More about this item

    JEL classification:

    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables
    • D1 - Microeconomics - - Household Behavior
    • I1 - Health, Education, and Welfare - - Health

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