South Africa’s transition to democracy in 1994 created new possibilities for economic policy. Economic liberalization brought sustained, if unspectacular, growth that reversed the long decline in per capita incomes, but left its scars in much job shedding associated with business becoming internationally competitive. This accords with international evidence that trade liberalization takes time to realize positive employment effects. Disappointing employment growth in the face of an expanding labourforce fed rising unemployment. However, using poverty estimates from a combination of sources, this study demonstrates that poverty nevertheless declined quite substantially after the turn of the century. Poverty dominance testing shows this conclusion to be insensitive to the selection of poverty line or measure. But empirical analysis does not allow strong conclusions to be drawn on causal relationships between globalization and poverty trends.
van der Berg, S.; Burger, R.; Louw, M. Post-Apartheid South Africa: Poverty and Distribution Trendsin an Era of Globalization. UNU-WIDER, Helsinki, Finland (2007) 26 pp. ISBN 978-92-9230-00-004-3 [WIDER Research Paper No. 2007/57]