Ending poverty and accelerating growth in South Africa, through the expansion of its social grant system

Ismael Fofana, Ramos Mabugu, Alhassane Camara and Babatunde Abidoye

Journal of Policy Modeling, 2024, vol. 46, issue 6, 1090-1102

Abstract: South Africa has one of the most extensive social assistance systems among developing countries; however, the proportion of the population below the national poverty lines remains relatively high. Thus, we develop a micro-macro framework to assess the economic growth implications of expanding South Africa’s social grant system under alternative conditions. We find that conditional poverty-alleviation social transfers foster growth while unconditional redistribution towards lower-income earners can hinder economic growth. From policy perspectives, we show that the transfer of purchasing power to extremely poor beneficiaries and their economic participation are required for poverty-alleviation social transfers to have positive economic outcomes.

Keywords: Social Transfer; Poverty Alleviation; Economic Growth; Economywide Modeling; South Africa (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:46:y:2024:i:6:p:1090-1102

DOI: 10.1016/j.jpolmod.2024.07.003

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