IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-03663377.html
   My bibliography  Save this paper

Economic and Distributional Impact of COVID‐19: Evidence from Macro‐Micro Modelling of the South African Economy

Author

Listed:
  • Margaret Chitiga‐mabugu

    (University of Pretoria [South Africa])

  • Martin Henseler

    (EDEHN - Equipe d'Economie Le Havre Normandie - ULH - Université Le Havre Normandie - NU - Normandie Université)

  • Ramos Mabugu
  • Hélène Maisonnave

    (EDEHN - Equipe d'Economie Le Havre Normandie - ULH - Université Le Havre Normandie - NU - Normandie Université)

Abstract

A computable general equilibrium model linked to a microsimulation model is applied to assess the potential short‐term effects on the South African economy of the ongoing COVID‐19 pandemic. With a particular focus on distributional outcomes, two simulations are run, a mild and a severe scenario. The findings show significant evidence of decline in economic growth and employment, with the decline harsher for the severe scenario. The microeconomic results show that the pandemic moves the income distribution curve such that more households fall under the poverty line while at the same time, inequality declines. The latter result is driven by the disproportionate decline in incomes of richer households while the poorest of the poor are cushioned by government social grants that are kept intact during the pandemic. The COVID‐19 pandemic is still unfolding and its economic modelling as well as the data used to operationalise the model will need to be updated and improved upon as more information about the disease and the economy becomes available.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed fr
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Margaret Chitiga‐mabugu & Martin Henseler & Ramos Mabugu & Hélène Maisonnave, 2021. "Economic and Distributional Impact of COVID‐19: Evidence from Macro‐Micro Modelling of the South African Economy," Post-Print hal-03663377, HAL.
    • Handle: RePEc:hal:journl:hal-03663377
    DOI: 10.1111/saje.12275
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Brahmbhatt, Milan & Dutta, Arindam, 2008. "On SARS type economic effects during infectious disease outbreaks," Policy Research Working Paper Series 4466, The World Bank.
    2. Jong-Wha Lee & Warwick J. McKibbin, 2004. "Globalization and Disease: The Case of SARS," Asian Economic Papers, MIT Press, vol. 3(1), pages 113-131.
    3. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    4. Maliszewska,Maryla & Mattoo,Aaditya & Van Der Mensbrugghe,Dominique, 2020. "The Potential Impact of COVID-19 on GDP and Trade : A Preliminary Assessment," Policy Research Working Paper Series 9211, The World Bank.
    5. Laborde Debucquet, David & Martin, Will & Vos, Rob, 2020. "Poverty and food insecurity could grow dramatically as COVID-19 spreads," IFPRI book chapters, in: COVID-19 and global food security, chapter 2, pages 16-19, International Food Policy Research Institute (IFPRI).
    6. Channing Arndt & Jeffrey D. Lewis, 2001. "The HIV|AIDS pandemic in South Africa: sectoral impacts and unemployment," Journal of International Development, John Wiley & Sons, Ltd., vol. 13(4), pages 427-449.
    7. S.M. Ntombela & M. Kalaba & H. Bohlmann, 2018. "Estimating trade elasticities for South Africa’s agricultural commodities for use in policy modelling," Agrekon, Taylor & Francis Journals, vol. 57(3-4), pages 221-232, October.
    8. Geeta Gandhi Kingdon & John Knight, 2006. "How Flexible are Wages in Response to Local Unemployment in South Africa?," ILR Review, Cornell University, ILR School, vol. 59(3), pages 471-495, April.
    9. David G. Blanchflower & Andrew J. Oswald, 1995. "An Introduction to the Wage Curve," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 153-167, Summer.
    10. Warwick McKibbin & Alexandra Sidorenko, 2006. "Global Macroeconomic Consequences of Pandemic Influenza," CAMA Working Papers 2006-26, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    11. Rulof Petrus Burger & Lodewicus Charl Coetzee & Carl Friedrich Kreuser & Neil Andrew Rankin, 2017. "Income and Price Elasticities of Demand in South Africa: An Application of the Linear Expenditure System," South African Journal of Economics, Economic Society of South Africa, vol. 85(4), pages 491-514, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ephrem Habtemichael Redda & Jhalukpreya Surujlal, 2021. "An Impact Assessment of Covid-19 on the South African Automotive Industry," Eurasian Journal of Business and Management, Eurasian Publications, vol. 9(3), pages 208-216.
    2. Shehabi, Manal, 2022. "Modeling long-term impacts of the COVID-19 pandemic and oil price declines on Gulf oil economies," Economic Modelling, Elsevier, vol. 112(C).
    3. Roberto Roson & Camille Van der Vorst, 2022. "General Equilibrium Analyses of COVID-19 Impacts and Policies: An Historical Perspective," Contributions to Economic Analysis, in: The Economics of COVID-19, volume 127, pages 57-70, Emerald Group Publishing Limited.
    4. Meltem A. Aran & Nazli Aktakke & Zehra Sena Kibar & Emre Üçkardeşler, 2022. "How to Assess the Child Poverty and Distributional Impact of COVID-19 Using Household Budget Surveys: An Application Using Turkish Data," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(4), pages 1997-2037, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Margaret Chitiga & Martin Henseler & Ramos Emmanuel Mabugu & Hélène Maisonnave, 2022. "How COVID-19 Pandemic Worsens the Economic Situation of Women in South Africa," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(3), pages 1627-1644, June.
    2. Mabugu, Ramos E. & Maisonnave, Helene & Henseler, Martin & Chitiga-Mabugu, Margaret & Makochekanwa, Albert, 2023. "Implications of COVID-19 and mitigation measures on gender and the Zimbabwean economy," Economic Modelling, Elsevier, vol. 121(C).
    3. Hélène Maisonnave & Bernard Decaluwe & Margaret Chitiga, 2016. "Does South African Affirmative Action Policy Reduce Poverty? A CGE Analysis," Poverty & Public Policy, John Wiley & Sons, vol. 8(3), pages 212-227, September.
    4. Sándor Kovács & Mohammad Fazle Rabbi & Domicián Máté, 2021. "Global Food Security, Economic and Health Risk Assessment of the COVID-19 Epidemic," Mathematics, MDPI, vol. 9(19), pages 1-16, September.
    5. Blanchflower, David G. & Oswald, Andrew J., 2006. "The Wage Curve: An Entry Written for the New Palgrave, 2nd Edition," IZA Discussion Papers 2138, Institute of Labor Economics (IZA).
    6. Ahmed, S. Amer & Baris, Enis & Go, Delfin S & Lofgren, Hans & Osorio Rodarte, Israel & Thierfelder, Karen, 2017. "Assessing the Global Economic and Poverty Effects of Antimicrobial Resistance," Conference papers 332903, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    7. Huan Wang & Sarah‐Eve Dill & Huan Zhou & Yue Ma & Hao Xue & Sean Sylvia & Kumi Smith & Matthew Boswell & Alexis Medina & Prashant Loyalka & Cody Abby & Dimitris Friesen & Nathan Rose & Yian Guo & Scot, 2021. "Health, economic, and social implications of COVID‐19 for China's rural population," Agricultural Economics, International Association of Agricultural Economists, vol. 52(3), pages 495-504, May.
    8. Fan, Victoria Y & Jamison, Dean T & Summers, Lawrence H, 2018. "Pandemic risk: how large are the expected losses?," Scholarly Articles 35014363, Harvard Kennedy School of Government.
    9. Luis Enrique Escalante Ochoa & Hélène Maisonnave, 2021. "The impact of the COVID-19 pandemic on women's welfare and domestic burdens in Bolivia," Working Papers hal-03118060, HAL.
    10. George Verikios & Maura Sullivan & Pane Stojanovski & James Giesecke & Gordon Woo, 2016. "Assessing Regional Risks From Pandemic Influenza: A Scenario Analysis," The World Economy, Wiley Blackwell, vol. 39(8), pages 1225-1255, August.
    11. Tiberiu Cristian Avrămescu, 2020. "Assessments on the Effects of the Coronavirus Pandemic on the Economies of the Central and South-East European Union Countries," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 105-112, August.
    12. Ahmed, Syud Amer & Barış, Enis & Go, Delfin S. & Lofgren, Hans & Osorio-Rodarte, Israel & Thierfelder, Karen, 2018. "Assessing the global poverty effects of antimicrobial resistance," World Development, Elsevier, vol. 111(C), pages 148-160.
    13. Marcus R. Keogh‐Brown & Simon Wren‐Lewis & W. John Edmunds & Philippe Beutels & Richard D. Smith, 2010. "The possible macroeconomic impact on the UK of an influenza pandemic," Health Economics, John Wiley & Sons, Ltd., vol. 19(11), pages 1345-1360, November.
    14. Ramos Mabugu & Margaret Chitiga, 2007. "Poverty and inequality effects of a high growth scenario in South Africa: A dynamic microsimulation CGE analysis," Working Papers 04/2007, Stellenbosch University, Department of Economics.
    15. Klona, Maria, 2021. "The Days After COVID-19: A Meta-Analysis on the Impact of Epidemics and Pandemics on Long-Term Macro-Economic Performance," American Business Review, Pompea College of Business, University of New Haven, vol. 24(1), pages 188-224, May.
    16. Tiberti, Luca & Maisonnave, Helene & Chitiga, Margaret & Mabugu, Ramos, 2018. "Reforming grants to tackle child poverty: An integrated macro-micro approach," World Development, Elsevier, vol. 112(C), pages 272-281.
    17. John Beirne & Nuobu Renzhi & Eric Sugandi & Ulrich Volz, 2021. "COVID‐19, asset markets and capital flows," Pacific Economic Review, Wiley Blackwell, vol. 26(4), pages 498-538, October.
    18. Roshen Fernando & Warwick J. McKibbin, 2021. "Macroeconomic policy adjustments due to COVID-19: Scenarios to 2025 with a focus on Asia," CAMA Working Papers 2021-17, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    19. Maliszewska,Maryla & Mattoo,Aaditya & Van Der Mensbrugghe,Dominique, 2020. "The Potential Impact of COVID-19 on GDP and Trade : A Preliminary Assessment," Policy Research Working Paper Series 9211, The World Bank.
    20. Betarelli Junior, Admir Antonio & Faria, Weslem Rodrigues & Proque, Andressa Lemes & Perobelli, Fernando Salgueiro & de Almeida Vale, Vinicius, 2021. "COVID-19, public agglomerations and economic effects: Assessing the recovery time of passenger transport services in Brazil," Transport Policy, Elsevier, vol. 110(C), pages 254-272.

    More about this item

    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:hal:journl:hal-03663377. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.