Original Research

The general equilibrium effects of a productivity increase on the economy and gender in South Africa

Margaret Chitiga-Mabugu, Godbertha Kinyondo
South African Journal of Economic and Management Sciences | Vol 12, No 3 | a221 | DOI: https://doi.org/10.4102/sajems.v12i3.221 | © 2011 Margaret Chitiga-Mabugu, Godbertha Kinyondo | This work is licensed under CC Attribution 4.0
Submitted: 17 June 2011 | Published: 17 June 2011

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Margaret Chitiga-Mabugu, University of Pretoria, South Africa
Godbertha Kinyondo, University of Pretoria, South Africa

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This study utilises a computable general equilibrium model to examine the effects of economy-wide (SIM 1) and partial (SIM 2) productivity increases on the economy, gender employment, wages, income and welfare in South Africa. SIM 1 results in ‘output’ led employment demand and increased earnings for all skill types of men and women. Skilled men benefit more than others in most sectors. Under SIM 2, productivity has a negative employment impact in the selected sectors, on all skills mostly in labour-intensive sectors. In general, productivity improves households’ welfare due to reduced commodity prices and improved earnings. If productivity rises only in men-intensive sectors, men’s wages rise while raising productivity in only women-intensive sectors affect women negatively. 


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