The economy-wide impacts of the labour intensification of infrastructure expenditure in South Africa

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Show simple item record McCord, Anna Van Seventer, Dirk 2013-10-03T16:25:33Z 2013-10-03T16:25:33Z 2004-12
dc.identifier.isbn 1-77011-024-0
dc.description.abstract This paper examines the performance of public works in addressing both micro and macroeconomic policy objectives relating to growth, employment and poverty reduction in South Africa. The microeconomic analysis suggests that while participation in a public works programme may contribute to a reduction in the depth of poverty, with improvements in participation in education and nutrition, and have positive psychosocial benefits, the impact of a short-term programme may not be significant in terms of a reduction in headcount poverty or improvements in asset ownership (material or financial). In this case the public works programme income may function essentially as a temporary wage shock, since the insurance function of the transfer is limited by the short duration of the employment period. From a macroeconomic perspective, a social accounting matrix (SAM) is used to estimate the impact of shifting R3 billion expenditure from machine to labour based infrastructure provision over a one year period. The SAM indicates that the impact would be to increase employment by 1%, the income of the poorest quintile by 2% (if employment were exclusively targeted to this group) and GDP by 0.1%. While these are positive outcomes, they are not significant in terms of South Africa's overall economic and employment performance. The conclusion is drawn that from both a macro and microeconomic perspective, there is reason to be cautious about the potential of a national public works programme based on shifting the labour intensity of infrastructure provision, and offering short-term employment opportunities, to have a significant impact on poverty, employment or growth. en_US
dc.description.sponsorship This paper was originally written as a conference paper for the DPRU, TIPS & Cornell Conference on African Development and Poverty Reduction, the Macro-Micro Linkages convened from 13 to 15 October 2004. It draws on research carried out in collaboration with Gary Taylor of IT Transport, funded by the UK Department of International Development (South Africa). en_US
dc.language.iso en en_US
dc.publisher CSSR and SALDRU en_US
dc.relation.ispartofseries CSSR/SALDRU Working Paper;93
dc.subject Labour en_US
dc.subject Infrastructure en_US
dc.subject Expenditure en_US
dc.subject Public Works en_US
dc.title The economy-wide impacts of the labour intensification of infrastructure expenditure in South Africa en_US
dc.type Working Paper en_US

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