On the impact of provincial development policies in South Africa

Abstract

Although South Africa is one of the biggest economies in Africa, poverty and income inequality persist and a vast number of households lack access to water and sanitation services. Provincial governments have implemented the Provincial Development and Growth Strategy to improve standards. We evaluate its effects on selected development indicators. Using a generalization of the Difference-in-Differences method, we study the effects on four development indicators: food security, economic well-being, and water and sanitation security. We use secondary data from the General Household Survey, collected between 2002-2017 and conclude that i) the policies improve development indicators; ii) the effects are heterogeneous across racial and geographic distributions of households. Long-term economic stimulators, such as employment opportunities and education for vulnerable communities, are needed to improve household welfare across the provinces. Programs emanating from these development policies should be ongoing and continuously adapted to fulfill the specific needs of the local groups.