The impact of the international economic crisis on child poverty in South Africa

Stellenbosch Working Paper Series No. WP13/2010
 
Publication date: 2010
 
Author(s):
[protected email address] (Department of Economics, Pretoria University)
[protected email address] (Department of Economics, Laval University)
[protected email address] (Financial and Fiscal Commission, South Africa)
[protected email address]
[protected email address] (Department of Economics, Laval University)
[protected email address] (Department of Economics, University of Stellenbosch)
[protected email address] (Department of Economics, University of Stellenbosch)
[protected email address] (Department of Economics, University of Stellenbosch)
 
Abstract:

This paper reports on a study to provide insights into the magnitude of the shocks associated with the recent global economic crisis in macroeconomic terms in South Africa, the country’s capacity to withstand or cushion these shocks, and the extent of fragility in terms of poverty levels and child wellbeing. The analysis combines macro-economic and micro-economic tools to assess the extent of the crisis’ impact on the country. The study finds that the poverty headcount ratio increases little in the moderate crisis scenario, but substantially under the severe scenario. However, under both scenarios there is a relatively successful return to close to the business as usual trend. It is important to note though that under both scenarios, more poverty sensitive measures (the poverty gap ratio and the poverty severity ratio) decline more, and remain in negative territory longer, showing that the major impact of the crisis is on the poorest, and that this impact is most difficult to overcome.

 
JEL Classification:

C31, C68, D31, E37, G01, I32

Keywords:

Economic crisis, Computable general equilibrium, Forecasting and simulation, Almost ideal demand system, Child poverty measurement, South Africa

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1 March 2021
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1 March 2021
Even with the release of data showing a record high unemployment rate in 2020Q4, it turned out to be a fairly good week for the SA economy. Daily new COVID-19 infections remained well contained, while the second batch of 80 000 J&J vaccines arrived (albeit controversially with the grounded SAA being the carrier). In addition, relative to the October...

Read the full issue