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 The Post-Apartheid Evolution of Earnings Inequality in South Africa, 1995-2004
Phillippe G. Leite, Terry McKinley and Rafael Guerreiro O sorio 7 location. According to Ferreira, Leite and Litchfield (2006), the inability to control for such correlations is one reason w hy these types of inequality decom positions are m erely suggestive of the causal factors underlying distri...
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Phillippe G. Leite, Terry McKinley and Rafael Guerreiro O sorio 7 location. According to Ferreira, Leite and Litchfield (2006), the inability to control for such correlations is one reason w hy these types of inequality decom positions are m erely suggestive of the causal factors underlying distributional dynam ics. 3 IN COM E IN EQ U A LITY IN SOU TH A FRICA : A N OVERVIEW A. TRENDS IN IN COME IN EQ UALITY AND O THER WELL-BEING MEASURES South Africa is one of the m ost unequal countries in
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=7
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=7
Phillippe G. Leite, Terry McKinley and Rafael Guerreiro O sorio 5 C. DECOMPO SITIO N S O F THE GEN ERALIZED EN TRO PY MEASURES 1. STATIC D ECOM POSITION Generalized Entropy inequality indexes have the advantage—<span class="highlight">com</span> pared to the Gini coefficient—of being decom posable (statically) into sub-groups. For this study, w e use nine characteristics of the heads of households to differentiate the population into the follow ing sub-groups: Age of household head i) under 25, ii) 25-34, iii) 35-44, iv) 45
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=9
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=9
Phillippe G. Leite, Terry McKinley and Rafael Guerreiro O sorio 7 location. According to Ferreira, Leite and Litchfield (2006), the inability to control for such correlations is one reason w hy these types of inequality decom positions are m erely suggestive of the causal factors underlying distributional dynam ics. 3 IN <span class="highlight">COM</span> E IN EQ U A LITY IN SOU TH A FRICA : A N OVERVIEW A. TRENDS IN IN COME IN EQ UALITY AND O THER WELL-BEING MEASURES South Africa is one of the m ost unequal countries in
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=10
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=10
ensional inequality, one should highlight the large <span class="highlight">com</span> ponent of between-group inequality by race. This has contributed to the low level of hum an developm ent am ong Africans. The World D evelopm ent Report 2006 highlights the im pact of such inequalities by <span class="highlight">com</span> paring the life chances of tw o hypothetical new borns in South Africa, one African and poor and the other White and rich: “the opportunities that these two children face to reach their full hum an potential are vastly different from the outset
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=16
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=16
14 International Poverty Centre Working Paper nº 32 allow us to split self-em ployed incom e from em ployer incom e. This is a distinct disadvantage because the self-em ployed are likely poorer than em ployers. Social insurance transfers <span class="highlight">com</span> prise all types of regular receipts from pensions, social w elfare and other governm ental grants. O ther regular incom es <span class="highlight">com</span> prise item s such as royalties, interest, dividends, alim ony, and allow ances received from fam ily m em bers living elsew here. N
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=17
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=17
Phillippe G. Leite, Terry McKinley and Rafael Guerreiro O sorio 15 The decom position of changes in inequality yields three term s: one for the changes in the w eight of the incom e <span class="highlight">com</span> ponent in total incom e; another for the changes in the concentration (i.e., relative distribution) of the incom e <span class="highlight">com</span> ponent; and a third for the interaction betw een the tw o. Table 4 show s that the Gini coefficient of total incom e rose 2.7 per cent from 1995 to 2000 as a result of these factors. The first
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http://www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=32
www.undp-povertycentre.org/pub/IPCWorkingPaper32.pdf#page=32
30 International Poverty Centre Working Paper nº 32 APPEN D IX PO VERTY DECOMPO SITIO N PRESEN TED IN TABLE 1 Datt and Ravallion (1992) have proposed a decom position technique for Foster, Greer and Thorbecke poverty indices19 that identifies a grow th <span class="highlight">com</span> ponent (w hich is calculated by holding the Lorenz curve constant and allow ing the m ean to change), a redistribution <span class="highlight">com</span> ponent (w hich holds the m ean constant and allow s the Lorenz curve to change) and a residual term .20 Mathem atically
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