IDEAS home Printed from https://ideas.repec.org/p/gat/wpaper/2607.html

Breaking the Poverty and Poor-Health Trap: A Structural Analysis of Informality in South Africa

Author

Listed:
  • Julien Albertini

    (Université Lumière Lyon 2, Université Jean-Monnet Saint-Etienne, emlyon business school, GATE, 69007, Lyon, France)

  • Tony Berthonneau

    (Le Mans Université, GAINS-TEPP; Université Lumière Lyon 2, Université Jean-Monnet Saint-Etienne, emlyon business school, GATE, 69007, Lyon, France)

  • Anthony Terriau

    (Le Mans Université, GAINS-TEPP)

Abstract

We study the interplay between informality, health, and education in South Africa. Using data from the National Income Dynamics Study, we document large disparities in health and labor market outcomes over the life cycle. We develop and estimate a life-cycle search-and-matching model with endogenous education and a dual labor market. We show that informal employment and poor health reinforce each other, generating a persistent poverty and poor-health trap. Policy experiments show that the optimal reform combines tertiary education subsidies, a broader tax base, and a lower average tax burden on earnings, increasing employment, welfare, and health while preserving fiscal balance.

Suggested Citation

  • Julien Albertini & Tony Berthonneau & Anthony Terriau, 2026. "Breaking the Poverty and Poor-Health Trap: A Structural Analysis of Informality in South Africa," Working Papers 2607, Groupe d'Analyse et de Théorie Economique Lyon St-Etienne (GATE Lyon St-Etienne), Université de Lyon.
    • Handle: RePEc:gat:wpaper:2607
    as

    Download full text from publisher

    File URL: https://www.gate.cnrs.fr/RePEc/2026/2607.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • J48 - Labor and Demographic Economics - - Particular Labor Markets - - - Particular Labor Markets; Public Policy
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gat:wpaper:2607. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Béatrice HENRY (email available below). General contact details of provider: https://edirc.repec.org/data/gateefr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.