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Does South African Affirmative Action Policy Reduce Poverty? A CGE Analysis

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  • Helene Maisonnave

    (ULH - Université Le Havre Normandie - NU - Normandie Université)

  • Bernard Decaluwé

    (ULaval - Université Laval [Québec])

  • Margaret Chitiga

Abstract

This paper presents a computable general equilibrium model (CGEM) able to measure the impacts of the affirmative action policy set up in South Africa. In order to decrease inequalities inherited from the former regime, the government encourages firms to employ Historically Disadvantaged Persons (HDP). Through this study, we evaluate the impact of this policy on employment, poverty and inequality. To evaluate impacts on poverty and inequality, we use a CGE Top Down approach. The paper analyses two scenarios; the first one deals with the impact of affirmative action on skilled jobs. The second scenario adds to the previous by including semi skilled workers in the simulation. Both of these scenarios show a deep decrease in unemployment as well as a fall of poverty for each population groups.
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Suggested Citation

  • Helene Maisonnave & Bernard Decaluwé & Margaret Chitiga, 2019. "Does South African Affirmative Action Policy Reduce Poverty? A CGE Analysis," Working Papers hal-02314221, HAL.
    • Handle: RePEc:hal:wpaper:hal-02314221
    Note: View the original document on HAL open archive server: https://normandie-univ.hal.science/hal-02314221
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    Cited by:

    1. Ngwenya, Mthunzi A. & Paas, Leonard J., 2012. "Lifecycle effects on consumer financial product portfolios in South Africa: An exploratory analysis of four ethnic groups," Journal of Economic Psychology, Elsevier, vol. 33(1), pages 8-18.
    2. Boeters, Stefan & Savard, Luc, 2013. "The Labor Market in Computable General Equilibrium Models," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1645-1718, Elsevier.

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    More about this item

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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