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Despite having a middle-income status, many South African households are either already in or are about to fall into poverty. The income and wealth distribution in South Africa is among the most uneven in the world, and many households lack even the most basic access to healthcare, clean energy, and clean water. Although it has increased government spending, South Africa's government has made significant steps to combat poverty and inequality and encourage economic growth. Understanding the connection between social investment, poverty, inequality, and economic growth is, therefore, necessary to comprehend the ambiguity that currently prevails. In order to analyze the effects of social investment on poverty and economic growth in South Africa between 1990 and 2020, this paper uses the cointegration technique. The cointegration estimates indicate that there is no correlation between social investment, poverty, inequality, and economic development. According to study findings, South Africa's macroeconomic policies, which seem to be more urban-focused, need to be modified and redirected into inclusive policies with strict constraints to assure their implementation. The transformation of rural and township life will be aided by this plan. [ABSTRACT FROM AUTHOR]

The paper explores the income distribution as a channel of transmission of the effects of economic growth on poverty reduction. For that purpose, we analyse data for the CESEE countries with a focus on the Macedonian economy. Since the 1990s, in the transition process to market economies, inequalities within countries in the CESEE region have risen the most. The income distribution achieved in the last decade is not sufficient to neutralise the high inequality created after 1990. The Macedonian economy shows improved income distribution in the last decade as well, which influences the level of poverty. Still, income inequality and the relative poverty rate are among the highest in the CESEE region. The study sheds light on the effects of the predistributive and redistributive factors on the level of inequality and poverty. We consider the extent to which different parts of the income distribution are affected by the process of average income growth. The main conclusion from the empirical analysis for the CESEE countries is that the sign of the growth rate of the average income of the population, in most cases, is an important predictor of the income growth rate of the quintile groups. Correlation results show that the sign of the growth rates of the average income of the population is the most important determinant for the sign of the growth rates of the average income of the quintile group for the quintiles nearest to the average income of the population. [ABSTRACT FROM AUTHOR]

This paper estimates the dampening effect of rising inequality on growth effects on poverty rates using the U.S. county level data. According to the "growth elasticity" argument, rising inequality weakens the magnitudes of the growth effects on poverty reduction. The dampening effect is defined as the negative effect of rising inequality on the growth elasticity of poverty and is decomposed into the direct and the indirect dampening effects. Where the direct dampening effect is equal to the estimate of inequality elasticity of poverty. The indirect dampening effect is calculated as the difference between the estimate of a benchmark growth elasticity of poverty and the estimate of growth elasticity of poverty while allowing inequality to change. The benchmark growth elasticity of poverty is estimated from a model which assumes inequality as constant. This study analyzes data on poverty rates, real median household income and inequality from 731 counties of the United States. Data are compiled from two programs of the U.S. Census Bureau and converted into annualized percent changes. Unlike previous studies analyzing survey data from developing countries, U.S. county data are comparable across counties and more reliable. The dampening effects are estimated using the ordinary least square technique applied to five models of poverty. The study finds that income growth does alleviate poverty, but growing inequality directly and indirectly dampens the growth effects on poverty rates. Estimate of the total dampening effect of inequality indicates that the rising inequality is likely to lift 129,405 fewer people out of poverty annually. The growth effect on poverty rates is estimated to be weaker in counties with growing inequality than that in counties with declining and unchanged inequality, confirming the dampening effect of rising inequality. Estimates of the regional effects captured by regional dummy variables suggest that regional specific factors do also dampen growth effect on poverty rates. One reason for such dampening is likely to be tightened-budgetary conditions emanating from cuts in social safety net programs across the United States during 2006-10. Overall, the results from this study indicate that merely pro-growth policies are unlikely to ensure faster poverty reduction in the United States. The policy intervention must also focus on pro-poor growth strategies targeting the incomes of the lower quintiles. [ABSTRACT FROM AUTHOR]

A comprehensive decomposition approach is applied to identify the factors that generated a remarkable change in income distribution, whereby in the a span of a decade, Brazilian inequality fell by one-fifth, and the incidence of poverty declined by two-thirds. It is argued that important elements related to these developments had been in place for some time. These elements included macroeconomic stability, long-standing increases in educational attainment, and favorable demographics in the form of a declining dependency ratio that proved to be both poverty- and inequality-reducing. Robust economic growth during the 2000s and the early 2010s resulted in across-the-board income gains that were widely shared, owing to mechanisms that favored advances at the lower end of the distribution of earnings. Demographics, as well as changes in educational attainment, labor force participation, and lower-skill prices explain most of the significant drop in the headcount ratio, with education and the interaction between economic growth and a rising wage floor accounting for the bulk of the change. The same factors explain up to 85% of the decline in income dispersion that was especially driven by markedly compressed earnings differentials. Human capital accumulation and strong labor market institutions thus stand out as key mechanisms linking economic growth to income distribution. [ABSTRACT FROM AUTHOR]

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Poverty rate is influenced by numerous factors. The determining ones are economic growth and the distribution of its effects. This article is therefore focused on the analysis of these effects and their relationship, as well as their influence on poverty at a regional level (NUTS 3, 'kraj'). For the analysis of interactions between growth and distribution in correlation to poverty reduction, the Bourguignon model (the Poverty-Growth-Inequality triangle) and the growth incidence curve (GIC) were used. It was found that economic growth positively influences income inequalities as well as decreases the share of population under the poverty threshold in all regions. However, the development differs across regions. Based on the development and tendencies of the gross domestic product (GDP), income distribution and poverty it is obvious that economically strong regions (or their populations) dealt better with poverty during the crisis period. [ABSTRACT FROM AUTHOR]