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Household Formation, Poverty and Unemployment – The Case of Rural Households in South Africa


  • Sonja Keller

    () (Department of Economics, University of Stellenbosch)


The paper examines household formation and composition decisions within the context of risk reduction and risk mitigation strategies of the poor in South Africa. A multi-level heckprobit estimator is employed in order to capture the influence of various factors at the individual, household and regional level, and we focus on the implications of the presence of pensioners and the unemployment on household composition and structure. Results are consistent with earlier findings that pensions are a key insurance mechanism for cushioning younger household members against adverse labour market conditions in rural South Africa. Hence they explain the propensity by household members to postpone formation of new independent household in order to continue living in multigenerational households.

Suggested Citation

  • Sonja Keller, 2004. "Household Formation, Poverty and Unemployment – The Case of Rural Households in South Africa," Working Papers 01/2004, Stellenbosch University, Department of Economics.
  • Handle: RePEc:sza:wpaper:wpapers9

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    File Function: First version, 2004
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    More about this item


    households; poverty; unemployment; rural South Africa;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General


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