Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/235525
Authors: 
Adhikari, Tamanna
Greyling, Talita
Rossouw, Stephanie
Year of Publication: 
2021
Series/Report no.: 
GLO Discussion Paper No. 883
Publisher: 
Global Labor Organization (GLO), Essen
Abstract: 
Social welfare payments (SWP) were designed with policy priority to transfer revenue to vulnerable groups, thereby addressing poverty and inequality. Previous studies have shown that SWPs alleviate poverty, but investigating their effect on well-being is sparse. We investigate the relationship between SWPs and the mean subjective well-being (SWB) of a household and analyse it across household income quintiles. We use the National Income Dynamics Study dataset, which is representative of South Africa. South Africa is an example of extremes, as it suffers from poverty, inequality, and low levels of SWB; yet, paradoxically, it has an exemplary social welfare system. We use a range of analytical methods, including ordered probit regressions and a quasi-experimental technique. We find that the highest household income quintiles claim SWPs meant for the poor, most likely leading to increased inequality. Additionally, SWPs are positively related to SWB for quintiles one to four, but the relationship is negative in the highest quintile.
Subjects: 
Subjective well-being
social welfare payment
quasi-experiment
South Africa
JEL: 
I31
J13
J18
Document Type: 
Working Paper

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