Abstract
This study utilises a computable general equilibrium model to examine the effects of economy-wide (SIM 1) and partial (SIM 2) productivity increases on the economy, gender employment, wages, income and welfare in South Africa. SIM 1 results in ‘output’ led employment demand and increased earnings for all skill types of men and women. Skilled men benefit more than others in most sectors. Under SIM 2, productivity has a negative employment impact in the selected sectors, on all skills mostly in labour-intensive sectors. In general, productivity improves households’ welfare due to reduced commodity prices and improved earnings. If productivity rises only in men-intensive sectors, men’s wages rise while raising productivity in only women-intensive sectors affect women negatively.
Highlights
The South African democratic government that came to power in 1994 presided over Africa’s largest and most industrialised economy, but one that suffered from gross inequities (Gini index 59.3) and a lack of international competitiveness
Progrowth reforms assume that growth in a small or middle income open economy like South Africa is dependent on increasing efficiency and productivity, which depend on a range of factors, including improved human capital and education, infrastructural investment, trade reform and the existence of contestable markets
This study uses a structural-neoclassical model, based on the general equilibrium model developed by Dervis, de Melo and Robinson (1982), which was extended into an International Food Policy Research Institute (IFPRI) standard computable general equilibrium (CGE) model (Lofgren, Harris & Robinson 2001)
Summary
The South African democratic government that came to power in 1994 presided over Africa’s largest and most industrialised economy, but one that suffered from gross inequities (Gini index 59.3) and a lack of international competitiveness. The question that needs to be addressed is what is the likely effect of productivity growth on employment and wages of men and women of various skills in South Africa, given the significant differences in the gender composition of employment across sectors? Söderbom and Teal (2003) used a panel data analysis on 93 countries between 1970-2000 to find if trade and higher levels of human capital promote productivity growth Their results showed a doubling of the level of openness resulting in a 0.8 per cent increase in technical progress. 2000–2006), the contribution of this study is to ascertain the impact of the implied increased productivity on gender labour, households welfare and the South African economy
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
