Authors: Balwant Singh Mehta, Somjita Laha and Alakh N Sharma*
SCIS Working Paper | Number 28
Technology has transformative effects on not only production process and distribution but also the future of work. Recent studies also suggest that ongoing digital transformation will disrupt the existing structure of the economy and patterns of work. The Indian economy is also in the thick of this transition. Concerns are being raised in various forums about the future of work in India, under emerging digital technologies, with its level of economic development, labour market structure and degree of digital penetration. This paper examines how the progress of digital technology is transforming the world of work and labour market institutions in India. This has been analysed in the context of changes in the labour markets in the wake of liberalisation of the economy initiated from the 1990s, which also coincides with the high-growth period.
Authors: Arabo Ewinyu, Fikile Masikane and Edward Webster
SCIS Working Paper | Number 27
Working from home is not new. Indeed, it was the norm at the dawn of the industrial revolution over two centuries ago. Due to COVID-19 and the imposed lockdown, more people than ever are working from home. Through this paper, the authors pose three fundamental questions related to working from home. Firstly, are workers completing a circle and returning to “homework” as the new norm? Secondly, what do preliminary findings highlight about the work-life balance of women? To answer this, the authors drew on a novel panel dataset, NIDS-CRAM. Lastly, the authors reflect on pilot survey responses to determine the effects of remote work on managers and worker conditions.
BEE Working papers
SCIS Working papers | Numbers 18 -26
The Southern Centre for Inequality Studies, with support from the Open Society Foundation, conducted a study focussing on black economic empowerment policy. Whilst most agree that progress with empowerment policy has been limited, there remains no clear framework for monitoring progress or evaluating outcomes. The study locates empowerment within an analysis of wealth accumulation and the distribution of assets in a changing economy. It sought to identify pathways to a more inclusive economy by considering how the idea of empowerment might relate to the possibilities for growth and national development in South Africa. This BEE Working Papers series, produced by leading scholars, policy makers and practitioners, seeks to engage in dialogue with civil society, business and government by providing a clearer definition of the meaning of BEE and a reappraisal of its relationship with other policy objective.
- SCIS Working Paper | Number 26 | Wandile Sihlobo and Mzukisi Qobo | September 2021 | Addressing constraints to South Africa’s agriculture inclusiveness
- SCIS Working Paper | Number 25 | Sumayya Goga and Elvis Korku Avenyo | September 2021 | Industrial policy, the manufacturing sector and black empowerment
- SCIS Working Paper | Number 24 | Victor Kgalema, Carmel Marock and Stephanie Allais | April 2021 | The alignment of black economic empowerment and skills policies
- SCIS Working Paper | Number 23 | Lumkile Mondi | September 2021 | Eskom, IDC, DBSA: BEE and empowerment
- SCIS Working Paper | Number 22 | Liberty Mncube & Hardin Ratshisusu | September 2021 | Competition policy and black empowerment
- SCIS Working Paper | Number 21 | David Francis and Imraan Valodia | September 2021 | Black Economic Empowerment: A Review of the Literature
- SCIS Working Paper | Number 20 | Michelle Joubert | Date 2021 | How to assess transformation of ownership of the South African private sector
- SCIS Working Paper | Number 19 | Duma Gqubule | April 2021 | Black Economic Empowerment Transactions in South Africa after 1994
- SCIS Working Paper | Number 18 | Alex M Mashilo & Renai Moothilal | September 2021 | Black economic empowerment in the automotive manufacturing industry
Author: Dev Nathan
SCIS Working Paper | Number 17
This working paper explores the way in which knowledge can be turned into a monopoly and enable the capture of rent, or income in excess of what can be earned by commoditised, non-monopolised knowledge. Arguing that the monopolisation of knowledge has a long history in the creation of inequality, including gender inequality within a society, it considers the ways in which knowledge and inequality interact in small-scale agricultural societies and in large-scale capitalism.
The paper utilizes the concept of knowledge economy and considers how the relationship between knowledge and inequality can be understood as a form of contingent articulation of different social and economic processes. This nexus of knowledge and inequality is looked at in more detail in the context of patterns of inequality in the context of globalised production through global value chains. Policies for dealing with inequality usually deal with taxation and other forms of ex post action on inequality. The paper asks for a consideration of the modification of the manner in which the knowledge economy functions in dealing with inequality.
Author: Ihsaan Bassier
SCIS Working Paper | Number 16
How important are firms in the labour markets of developing countries? This working paper sets out to explain their importance by using matched employer-employee data from South Africa, and concludes that firms explain a larger share of wages compared to other richer countries. The author shows that this can be explained by the country's high degree of underemployment.
Estimating separations elasticities by instrumenting wages of matched workers with firm wages, among other methods, the paper finds a low separations elasticity which generates a high degree of monopsony. The correspondingly high estimated rent-sharing elasticity explains the important role of firm wage policies, even in an economy with a large labour surplus.
The author notes that this paper is a work in progress.
Author: Michael Sachs
SCIS Working Paper | Number 15
How did South Africa arrive at the fiscal crisis it currently faces? In search of answers, this paper reviews fiscal data and policy development over the last two decades. The structure of public spending and the dynamics of debt accumulation are looked at in some detail, but less attention is given to taxation.
The paper considers monetary policy only to the extent that it might (or might not) ease fiscal constraints. Macroeconomic trends are looked at insofar as they frame fiscal choices, but the broader context of the South Africa’s crisis – rising unemployment and poverty, extreme and entrenched inequalities, economic stagnation rooted in deindustrialisation and financialisation, and the slow but inexorable disintegration of the Congress movement – is left in the background.
The author notes that while South Africa’s crisis is multidimensional, and a single lens such as fiscal policy would inevitably be limited. However, the belief is it can help illuminate a wider terrain of historical change.
Authors: Aroop Chatterjee, Léo Czajka and Amory Gethin
SCIS Working Paper | Number 14
This working paper provides the details behind the op-ed that proposes a wealth tax to assist with fiscal sustainability, as well as reduce extreme wealth inequality.
It considers the feasibility of implementing a progressive wealth tax to collect additional government revenue and reduce inequality in South Africa in the wake of the COVID-19 crisis. Drawing on their companion paper on wealth inequality in South Africa, the authors estimate that under conservative assumptions, a progressive wealth tax on the richest 1% could raise between 1.5% and 3.5% of GDP. They discuss how sensitive their estimates are to assumptions on mismeasurement of wealth and tax evasion, and they examine technical issues related to the enforcement of the tax. They also explain how this new tax could interact with other capital related taxes already in place in South Africa, and discuss the potential impact on growth.
Based on this paper, there is also a wealth tax simulator available here. This tool allows the user to change tax rates, thresholds, and parameters (such as evasion rates and depreciation of wealth) to see how much revenue it generates, how much tax an individual would have to pay, and how it compares to other government expenditures and revenues.
Author: Ravi Shankar Srivastava
SCIS Working Paper | Number 11
The paper begins by dealing with conceptual issues around social security, social protection, and a social protection floor and argues for a rights based social protection floor for India. It then describes the broad social security or social protection system in place in the country. Since social protection systems are contingent on the characteristics and nature of work and employment relations, the paper uses existing data sources to elaborate on the (gendered) nature of the workforce. It also points out how existing social security systems reinforce labour market inequalities.
The paper goes on to discuss the nature of expansion of social security and social protection since the turn of the century. It describes two distinct phases: the first, from about 2002 to 2014 when these systems expanded due to grassroots movements, court judgments and government responses; the second, from 2014 onwards, when the new government turned its back on rights based social security, but populist pressures still led to the introduction of new measures, although the financial priority given to social protection declined.
Finally, the paper focuses on the current issues and challenges in moving towards a rights based social protection floor in India. It argues that such a social protection floor should combine worker-centric and citizen-centric features and comprise minimum guarantees for all at the base, with a second level of contributory social security. It considers the possible options for social protection – contributory and non-contributory and a universal basic income. It also analyses the consequences of the government’s thrust on digital financialisation for benefit payments and on biometric identification of workers and argues that, while the introduction of a social security registration system for workers is essential, approaches currently being put in place impose high costs on the poorest, and do not build on adequate data privacy safeguards.
Author: Juana Torres Cierpe
SCIS Working Paper | Number 10
This article is a study on the future of digital work in Colombia. It focuses on the case of workers in on-demand platforms, as they are the workforce most relevant to the notion of digital labour in the country. The research question was: What are the stakes of the legal vacuum in which on-demand platform workers find themselves? The methodological approach in the research paper consisted of analysis of secondary data (statistics and academic journal articles). The article consists of two parts. Part one gives an account of the labour changes of the past 30 years. These changes are analysed within the framework of neoliberal implementation, emphasising the phenomenon of informality. Part two concentrates on showing the situation of workers in the on-demand platform in Colombia. The problem of informality, into which this type of worker falls, is taken as an essential phenomenon. The section first shows a typology of the platforms operating in the country, where the on-demand platform workers perform. It then explores the implications of the legal vacuum that their situation involves. Finally, it analyses some studies that provide specific data regarding on-demand platform workers.
Innovation, Digital Platform Technologies and Employment: An Overview of Key Issues and Emerging Trends in South Africa
Author: Karmen Naidoo
SCIS Working Paper | Number 9
This paper provides an analytical profile of the South African labour market, along with a descriptive overview of the nature and extent of digital platform labour in the country. The paper also discusses the conceptual links between different types of innovation and employment, before reflecting on the implications of new forms of digital labour relations on labour organization and regulation. The literature on South Africa’s digital platform labour is nascent. Some estimates suggest that there are about 135 000 platform workers in the country. There are, however, important concerns about the quality of platform work, and recent research suggests that many platforms do not provide workers with a living wage or decent working conditions. There are several challenges to regulating platform work, in part due to workers being classified as independent contractors. Despite this, there are new emerging forms of worker organization amongst precarious workers in South Africa that go beyond traditional trade unions to incorporate broader worker associations.
Authors: Rosimina Ali. and Carlos Muianga
SCIS Working Paper | Number 8
As the digital platform economy and gig work have been accelerating, new expressions of work and tensions over working conditions, value creation and distribution, and over labour relations and regulation, are also emerging in Mozambique. Although digital work is still at an incipient stage in the country given the low access to information and communication technologies (ICTs) for the majority of the population and their socioeconomic profile, ICT access has expanded over the past decade. The number of start-ups enabling digital work has risen in the past five years and more recently amid the Covid-19 pandemic. Research on social conditions of digital gig work in Mozambique’s economy remains largely unaddressed. Following a political economy approach, this paper explores how digitally mediated forms of work are (re)shaping, changing or exacerbating the existing nature of work and what questions it poses for the future of work(ers) in Mozambique. We argue that, in the current pattern of growth in Mozambique, labour markets have a fragmented nature where work is dominated by informal, irregular, unstable and insecure social conditions. The preliminary primary evidence from digital gig workers shows that the organisation of digitally mediated work seems to reproduce the existing disruptions within labour markets. This seems acute in a context where digital gig work is not yet legislated and trade unions are absent. The future of workers depends on the broad organisation of socioeconomic structures and relations which shape the nature of work, structurally linked to processes of accumulation on a global scale. A failure to broadly analyse work beyond the physically sphere, including the digitally mediated forms of work and its intersections with paid and unpaid forms of work, has implications for the design and effectiveness of public policies on labour.
Author: Veronica Velez Osorio
SCIS Working Paper | Number 7
In Colombia there has been little social dialogue or democratic debate about how to effectively extend labour and social protections to digital platform gig workers. Rappi Inc. is a digital platform founded in Bogota, Colombia, in 2015, with the support of Colombian public institutions. Through the platform, customers can buy consumer goods such as meals, groceries, medicine, and so on. In 2019, Rappi Inc. became one of the most valuable digital technology companies in Latin America with a value of over $1 billion turning into what the venture capital business called a unicorn company. There is no regulatory framework in Colombia that enforces the continued relevance of employment relationsin the platform economy. Therefore, the rapid growth of Rappi Inc. has not been accompanied by the fair redistribution of profits, due to gig workers being classified as ‘independent contractors’, which sharpens the asymmetries between capital and labour. Rappi Inc. workers have responded by forming the Movimiento Nacional de Repartidores de Plataformas Digitales (MNRP, National Movement of Digital Platform Workers) and also by recently forming a trade union that operates through an app, Unidapp. These workers are actively disputing the current trajectory of digital work in Colombia. Furthermore, the paper analyses debates about the possibilities of a universal basic income as antipoverty- focused social protection, in the midst of intensifying calls for one in response to the crisis resulting from the Covid-19 pandemic. The government launched the Programa Ingreso Solidario (PIS, Solidarity Income Programme) to address the decrease in work-related incomes of poor households. The discussions on basic income have opened the debate on crucial public agenda issues, such as tax reform, public debt and vertical expansion of social protection, among others social demands.
Social protection in Ethiopia: making the case for a more comprehensive and equitable intervention in the digital economy
Author: Zerihun Berhane
SCIS Working Paper | Number 6
Ethiopia implements a range of contributory and non-contributory social protection programmes that jointly cover about 21% of the population. Using document review and secondary data, this paper analyses coverage, adequacy, and options for the vertical and horizontal expansion of social protection in Ethiopia, including cost estimates. It argues that the major challenges for the expansion of social protection in the country are political and financial. Politically, the government’s use of social protection as an instrument to promoting political stability made social protection subscribe to productive objectives and caused it to be tied to public works and conditional on labour contribution. Moreover, food security strategy and institutions dominated social protection for decades, making it essentially a rural programme rather than being all-inclusive. Financially, the high cost of implementing large-scale programmes made donor financing a constant feature of social protection in Ethiopia, having implications for sustainability of programmes. This paper provides a cost estimate scenario analysis of three social protection options: social pensions, child benefits, and disability grants. The cost estimate results indicate that implementing these programmes would be fairly affordable, particularly if accompanied by domestic resource mobilization, and suggests restructuring social protection institutions to make them more inclusive
Traversing the cracks: social protection toward the achievement of social justice, equality and dignity in South Africa
Author: Thandiwe Matthews
SCIS Working Paper | Number 5
South Africa has one of the most expansive social protection systems in Africa, yet it remains one of the most unequal countries in the world. The sudden onslaught of the Covid-19 pandemic has laid bare the devastating impact of deep global and domestic socio-economic inequalities, and the political, economic and social implications thereof. This paper explores how the conceptualisation and implementation of social protection policies can serve to simultaneously confront and reproduce the sources of power that sustain structural inequality in South Africa. Through an interdisciplinary lens, the research probes the gendered nexus between social policy and constitutionally protected socio-economic rights to elucidate how multiple forms of discrimination perpetuate the exclusion of historically marginalised groups, and particularly black African women, in post-1994 democratic South Africa.
Although social protection programmes have saved millions of households from falling deeper into poverty, the level of social grants is insufficient to meet households’ reproductive needs and undermines their very objectives. At the same time, the digitalisation of cash transfers coupled with the ‘marketisation of governance’ (Taylor, 2000) has trapped grant beneficiaries in relations of credit and debt.
The paper concludes that comprehensive social protection requires an approach that is not only efficient and pragmatic but is substantively inclusive, equitable and participatory, with the aim of dismantling relations of power that reproduce structural inequalities. However, social protection alone cannot address the complexity of challenges associated with structural inequality, and must be linked to labour market policies geared at improving the conditions of work for black African women in South Africa.
Authors: David Francis, Kamal Ramburuth-Hurt and Imraan Valodia
SCIS Working Paper | Number 4
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.
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
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
SCIS Working Paper | Number 2
SCIS Working Paper | Number 1
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.