Anna Orthofer wins Founder's Medal Prize

This year's highly prestigeous Economics Society of SA Founder's Medal for the best Doctoral thesis has been won by The Department of Economics at Stellenbosch's Anna Orthofer for her thesis entitled "Saving and wealth in the context of extreme inequality", completed in 2017. Her work was supervised by Stan du Plessis and co-supervised by Monique Reid and Dieter von Fintel.

Anna Orthofer studied aspects related to Saving and Wealth using newly available data for South Africa. Her focus on wealth, and its accumulation over time via
savings, resonate with current concerns within the discipline of Economics, as well as in policy spheres and the broader public. The international success of Thomas Piketty’s “Capital in the Twenty First Century” highlighted the public interest in the topic. That Anna’s thesis has already made impact in this field can be seen from the inclusion of her work, on invitation, in the World Inequality Database (WID) where, inter alia, Thomas Piketty, Gabriel Zucman and Emmanual Saez form the Executive Committee.

The first part of her work used household balance sheet data from South Africa to analyse the difference between the (usually reported) flow concept of savings and the balance sheet concept of savings (the change in wealth between two periods of time). She demonstrates the importance of capital gains in the strong growth in South Africa household wealth over recent decades. In the second part, Orthofer placed the evidence on household wealth in an international context, showing the trend towards a higher wealth-income ratio in South Africa, as also detected in the international data, though it started much later locally and the underlying factors have been different in South Africa. Finally, the dissertation turned to the distribution of wealth in South Africa, using two distinct data sources to show that, while an income or consumption perspective allows us to speak of a South African middle class, the balance sheet data suggest that a propertied middle class is still largely non-existent.

The thesis was evaluated, along with other selected entrants from South African universities, using the criteria of rigour and depth, intellectual coherence and originality and contribution to new knowledge in the field of Economics, with the adjudicator noting that "the candidate’s thesis is well written, clearly structured and easy to read and comprehend. It is appropriately pitched; and it makes a solid and distinct contribution to the body of knowledge in the economics discipline."