This paper aims at analyzing the effects of social policies on income inequalities in South Africa since the 1990s. Based on a framework of historical institutionalism, the heritage of a distributional regime based on institutional racism is highlighted. This had lasting effects on social policies which also had both liberal and conservative characteristics. Democratisation at the beginning of the 1990s led to the abolishing of institutional racism and conservative features, while the new framework tended to be of a more liberal nature than before. The Post- Apartheid transformation is marked by many contradictions: Concerning social policies, adverse effects of the ambiti ous affirmative action programme "Black Economic Empowerment" are diagnosed, as it creates incentives for highly-skilled public sector workers to work in the better-paid private sector. Apart from the resulting skills shortages, a tendency of cash transfers to replace public social services and infrastructure provision is diagnosed. In addition to this liberal characteristic of social policies, employment policies were not very successful, despite workfare tendencies in the approach towards welfare. As a result, overall income inequalities stagnated at very high levels after Apartheid, even with the rise of a black bourgeoisie and middle class.
income distribution social policy social protection racial discrimination social expenditure political development trend South Africa