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Regional disparities in non-economic quality of life in South Africa: convergence or divergence?

Stephanié Rossouw () and Talita Greyling ()
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Stephanié Rossouw: School of Economics, Faculty of Business, Economics, and Law, Auckland Univeristy of Technology

No 2017-06, Working Papers from Auckland University of Technology, Department of Economics

Abstract: If the ultimate purpose of economic growth is, as it claims to be, focused on enhancing human welfare then the question of whether or not convergence is present between poorer regions and their richer counterparts is one of utmost importance. In saying this, we now know that improvements beyond simple measures of income growth is necessary to address the multidimensionality, which defines quality of life. The purpose of this study is to investigate both economic and objectively measured true non-economic quality of life (TNEQoL) convergence dynamics across South Africa’s 234 municipalities for the period 1996-2014. The study tested for both 𝛽𝛽 −and 𝜎𝜎 − convergence and utilised dynamic panel methods (systems GMM specifically) for the latter. The primary results indicate unconditional convergence in both economic and TNEQoL but interestingly enough at different rates. TNEQoL seems to be converging at a faster rate, which reiterates the fact that poorer regions can achieve more than one would exect given their levels of per capita income. Through investigating conditional convergence in TNEQoL, it was found that the local government policy regarding poverty alleviation, level of human capital, level of income inequality as well as spare capacity were driving growth. These findings reveal substantial policy implications; as local governments will be able to influence policy towards those mu icipalities, which are not able to translate their significant income per capita growth into similar gains as regards to their non-economic quality of life.

Keywords: Quality of life; non-economic measures; convergence; South Africa (search for similar items in EconPapers)
JEL-codes: C33 O18 O55 R11 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ure
Date: 2017-06
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