Does South African Affirmative Action Policy Reduce Poverty? A CGE Analysis

Hélène Maisonnave , Bernard Decaluwé (1) , Margaret Chitiga

1 ULaval - Université Laval [Québec]

This article presents a computable general equilibrium model (CGEM) able to measure the impacts of the affirmative action policy set up in South Africa. In order to decrease inequalities inherited from the former regime, the government encourages firms to employ historically disadvantaged persons. Through this study, we evaluate the impact of this policy on employment, poverty, and inequality using a CGE top-down approach. The article analyzes one scenario that deals with the impact of affirmative action on skilled jobs. Results show a deep decrease in unemployment and poverty for each population group.

Keywords: inequality; labor market; computable general equilibrium model; top-down analysis; South Africa; poverty

Domains: Humanities and Social Sciences; Humanities and Social Sciences; Economics and Finance

Hélène Maisonnave, Bernard Decaluwé, Margaret Chitiga. Does South African Affirmative Action Policy Reduce Poverty? A CGE Analysis. Poverty and Public Policy, 2016. ⟨hal-02314218⟩