Do Social Grants Displace Remittances? Evidence From South Africa

Biyase, Mduduzi; Zwane, Talent; Rooderick, September

doi:10.19030/iber.v16i4.10042

Cited by 1 publication

(1 citation statement)

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“…Following a number of studies in this field (Maitra and Ray, 2003;Posel, 2016;Biyase et al, 2017), we assess the impact of social grantsdisability grant, social pension, child support grant, on the distribution of households' income by estimating the kernel density of a log of income with and without social grants for males and females separately. The most striking feature of the two figures is that while social grants slightly shift the entire distribution of income for the males (Figure 2), the impact on the distribution of income for the females (Figure 3) is more noticeable.…”

Section: "Morning After" Simulation: Before and After Comparisonmentioning

confidence: 99%

Assessing the impact of social grants on household welfare using propensity score matching approach

Zwane

Biyase

Rooderick

2022

IJDI

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Purpose This study aims to investigate the impact of social grants on rural household welfare in a village located in one of the poorest provinces in South Africa – KwaZulu Natal Province. Actually, since the inception of democratic rule, the South African government has turned to social grants to address the issues of poverty, income inequality and to improve household welfare. The coverage of social grants has increased substantially with more than 17 million (about 34% of the population) South Africans being recipients of social grants. Despite having relatively well-developed social security system, poverty levels in rural parts of South Africa remains very high. Design/methodology/approach This study uses a cross-sectional households survey data conducted in Hlokozi village. A propensity score matching technique, which accounts for non-random selection of households, is applied. Findings The results reveal that social grants have a significant and positive impact on rural household welfare. Specifically, the nearest neighbour matching estimates suggest that the causal effect for social grants on household welfare is the region of about R5,830. Consistent with the nearest neighbouring method, the results obtained using the Kernel matching method show that social grants are significant in improving rural household welfare. Originality/value While there are a number of studies that have shed some light on how social grant reduces poverty in South Africa, there are some gaps. Firstly, only a few studies have interrogated the impact of social grants on household welfare. Secondly, most of these studies have relied on descriptive analysis, and finally, besides poverty being high in rural areas, research on the impact of social grants on rural household welfare remains thin.

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Section: "Morning After" Simulation: Before and After Comparisonmentioning

confidence: 99%