Focus Area 3: Inclusive Growth in South Africa

Convenor: Haroon Bhorat

Aims and Tasks

The initial work programme of Focus Area 3 will be anchored around key participants in the national research community working on inclusive growth, followed by a process to identify possible other interested qualified researchers.

A first task for the group will be to develop a conceptual framework for defining and analysing inclusive growth as both an outcome and a process whereby increasing numbers of people participate in the growth process (in survivalist, informal and formal segments) and share equitably in the benefits of such growth.

Participating researchers will review existing research to identify and address gaps in our knowledge of the determinants (‘drivers’) of both the participative nature and distributional impact of economic growth and development, including household living conditions, education, health, social and economic participation and employment, livelihoods, ownership of private assets, work and social cohesion – leading to an identification of research priorities.

In addition, they will identify and assess issues relating to how social and economic policies impact on the degree of inclusivity of growth and development, including the effectiveness and outcomes of public spending programmes, social services, infrastructure investment and associated policy issues and fiscal considerations.

Research Topics

  1. Determining whether the distributional outcomes of growth are pro-poor, using growth incidence curves (GICs), also across sub-groups and labour market categories.
  2. The role of access to ‘social’ assets and (subsidised) services in attaining inclusive economic growth – i.e. changes in non-income welfare relating to household access to services and assets such as water, energy, telecommunications, transport, refuse removal, housing and sanitary services.
  3. The role of private asset ownership in inclusive growth – both growth outcomes in terms of the trend in private asset ownership, e.g. homes and financial assets (including employee share-ownership), as well as the growth process re the role of ownership in enabling economic participation (including the potential role of financial institutions in supporting such changes).
  4. Analysing how economic flows across age groups have changed in response to, inter alia, changes in social policy, economic circumstances and changing social norms, and what this says about the nature of economic growth in terms of employment, incomes, the expansion of social security, etc.
  5. The role of unemployment and employment in determining the degree of inclusivity of economic growth (in particular the process of output and income generation).
  6. The importance of linkages and transitions between survivalist, informal and formal segments for improving both participation and growth outcomes.
  7. Employment services, job search and public placement services.
  8. Wage and employment subsidies as elements in an economic inclusion and participation strategy.
  9. The role of small enterprise development and entrepreneurship in broadening economic participation.
  10. The role of product and factor market regulation as constraints and/or enablers of truly inclusive growth.
  11. Rural-urban migration, urbanisation and access to economic opportunities.
  12. Transport services (and subsidies), mobility and access to work opportunities.
  13. Links between education, training, labour market opportunities and economic participation.
  14. The impact of social conditions, crime and violence on participation and outcomes.
  15. Agriculture, land reform and rural development as elements of an inclusive growth strategy.
  16. Housing development, maintenance and upgrading, housing finance and housing market opportunities (including townships and rural villages or towns).
  17. Public procurement and the informal economy.
  18. Infrastructure investment, employment and the distribution of growth opportunities.
  19. Regional development, trade and inclusive growth.
  20. The impact of macroeconomic policy levers such as taxation, deficits, interest rates and exchange rates on inclusive growth processes and outcomes.

This research will be complemented by projects to generate better datasets (including accessing administrative data). One specific task that has been identified is the development of comprehensive income and expenditure data series. Similarly, the goal is to develop the application of ‘new’ methodologies, such as growth incidence curves and national transfer accounts, to measure the degree of inclusivity of growth. Such accounts allow cross-age-group analysis of economic flows to improve understanding of the distributional impact of economic growth. These and other data resources will be made available to the community of researchers.