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Working papers

Estimates of Employment in South Africa Under the Five-Level Lockdown Framework

Authors: David Francis, Kamal Ramburuth-Hurt and Imraan Valodia

SCIS Working Paper | Number 4
May 2020

During the COVID-19 pandemic and response, an important question, from both a health and economic policy perspective, is how many workers are able to return to work as the lockdown is eased and tightened in response to the spread of the virus. Using a static analysis derived from industry subsectors, we estimate employment allowed under each level of the five-level lockdown framework. We estimate that under level five of the lockdown framework, 40% of total employment is permitted, or 6.6 million workers. This rises to 55% (9.2 million) under level four; 71% (11.8 million) under level three; 94% (15.6 million) under level two and 100% under level one. This is a static analysis and assumes that no jobs are lost as a result of a lockdown. As such, its principle use is as a distributional analysis of the share of workers permitted to work under each level of the lockdown.

Estimating the Distribution of Household Wealth in South Africa

Author: Aroop Chatterjee, Léo Czajka and Amory Gethin

This working paper is the result of a collaboration between the Southern Centre for Inequality Studies and the World Inequality Lab.

SCIS Working Paper | Number 3
April 2020

This paper estimates the distribution of personal wealth in South Africa by combining tax microdata covering the universe of income tax returns, household surveys and macroeconomic balance sheets statistics. We systematically compare estimates of the wealth distribution obtained by direct measurement of net worth, rescaling of reported wealth to balance sheets totals, and capitalisation of income flows. We document major inconsistencies between available data sources, in particular regarding the measurement of dividends, corporate assets and wealth held through trusts. Both household surveys and tax data remain insufficient to properly capture capital incomes. Notwithstanding a significant degree of uncertainty, our findings reveal unparalleled levels of wealth concentration. The top 10 per cent own 86 per cent of aggregate wealth and the top 0.1 per cent close to one third. The top 0.01 per cent of the distribution (3,500 individuals) concentrate 15 per cent of household net worth, more than the bottom 90 per cent as a whole. Such high levels of inequality can be accounted for in all forms of assets at the top end, including housing, pension funds and other financial assets. Our series show no sign of decreasing wealth inequality since apartheid: if anything, we find that inequality has remained broadly stable and has even slightly increased within top wealth groups.

Beyond a Treasury View of the World: reflections from theory and history on heterodox economic policy options for South Africa

Author: Professor Vishnu Padayachee
SCIS Working Paper | Number 2
May 2018
This paper aims to set out some key alternative macroeconomic policy ideas for further debate and research in the context of the multi-disciplinary approach of the Wits Inequality Project. We ask what kind of macroeconomic policy interventions will be essential for growth and employment generation and to a successful struggle against rising income and wealth inequality in South Africa, and elsewhere. My assertion is that that unless we have a supportive macroeconomic framework, many other economic and social policy interventions for addressing growth and inequality will likely fail to gain much traction or purchase for budgetary and related reasons. I draw on both history and theory to demonstrate the early and respectable roots of heterodox economic thinking and support for a more activist state-led macroeconomic policy.  Those supportive of alternative heterodox policy ideas are often and quickly labelled macroeconomic populists or madmen and I aim to show that such heterodox, state led approaches to growth and development also have a rich history and respectable pedigree behind them. I comment briefly on the American New Deal and the recommendations of the South African Macroeconomic Research Group. Both were examples, in very different eras, of progressive macroeconomic policy interventions based on a state-led investment and ‘crowding in’ approach to development in direct contrast to a private finance, market led and ‘crowding out’ neoclassical orthodoxy. The paper then reviews some key ideas underlying a post-Keynesian approach, and ends with some specific proposals for macroeconomic reform in South Africa.

A Wealth Tax for South Africa, Sampie Terreblanche

SCIS Working Paper | Number 1
January 2018

The Southern Centre for Inequality Studies (SCIS) at the University of the Witwatersrand takes great pleasure in presenting this, our first Working Paper, by economic historian Sampie Terreblanche. It was exactly twenty years ago that Professor Terreblanche presented his testimony to the Truth and Reconciliation Commission (TRC). Two decades later, it remains extremely relevant. This Working Paper presents some contemporary reflections on inequality, penned by Professor Terreblanche. These are followed by a reproduction, in full, of his testimony to the TRC in November 1997, which called for the levying of a wealth tax on all affluent South Africans.