Browsing by Author "Stanwix, Benjamin"

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    Estimating the Impact of Minimum Wages on Employment, Wages and Non-wage Benefits: The Case of Agriculture in South Africa
    (2012-07) Bhorat, Haroon; Kanbur, Ravi; Stanwix, Benjamin
    Assessments of the impact of minimum wages on labour market outcomes in Africa are relatively rare. In part this is because the data available do not permit adequate treatment of econometric issues that arise in such an assessment. This paper attempts to estimate the impact of the introduction of a minimum wage law within the Agriculture sector in South Africa, based on 15 waves of the biannual Labour Force Survey (LFS), starting in September 2000 and ending in September 2007.
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    The impact of the agricultural minimum wage and the role of enforcement in South Africa
    (2011) Stanwix, Benjamin; Bhorat, Haroon
    Since 1999 South Africa gradually developed a detailed minimum wage schedule covering eleven sectors of the economy. Labour market institutions were also created to enforce the new laws; the efficacy of which has hitherto remained unexamined. The legislated minimum wage in South Africa varies across, and within sectors. Mandated wages within a sector can differ depending upon occupation type, the number of hours worked, as well as geographic location. There is thus no single national minimum wage. Internationally, minimum wages are widely used as a policy tool to protect vulnerable workers from exploitation and help alleviate poverty. In South Africa the socioeconomic arguments supporting minimum wages are well established, that is, minimum wages aim to redistribute earnings to low paid workers, assist workers with weak bargaining power, and lift the working poor out of poverty. The economic effect that minimum wages have, on employment in particular, is a classic labour economics question which has attracted considerable attention in the international literature. However, as the two introductory quotes illustrate, there is some disagreement among economists as to the precise impact of minimum wages. More broadly there are those who question whether minimum wages are a welfare enhancing intervention at all. The recent introduction of minimum wage laws in South Africa makes comprehensive enquiry into such issues particularly pertinent for economists and policymakers. It is therefore surprising that few empirical studies have investigated the impact of these policies on the local labour market. In an effort to begin filling the gap this paper focuses on the agricultural sector in South Africa. The first component of this paper investigates and measures the aggregate impact of the Agricultural Sectoral Determination. Observing changes in farmworker earnings, contract coverage, employment, and the number hours worked per week, provides insight into the impact of the law. These changes are examined using data from the South African Labour Force Surveys (LFS) 2000-2007 which includes three years before the law was introduced and four years afterwards. Descriptive statistics and difference-in-differences regressions are used to analyse the impact of the law. A control group, made up of similar workers not subject to the law, is used for comparison. Results show that the Sectoral Determination caused significant growth in average farmworker earnings and an increase in the number of workers holding written employment contracts. However, the probability of agricultural employment for a typical worker appears to have fallen, while hours worked were unaffected. After analysing these changes, the second component of the paper examines the associated and underexplored issue of enforcement and compliance. The number of farmworkers receiving sub-minimum wages (i.e. noncompliance) in South Africa is high and thus the observed impact of the law can be seen as a lower bound. I test to see whether the increase in wages which occurs over the period can be linked to formal enforcement of the Sectoral Determination.
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    Minimum Wage Enforcement in the Developing World
    (2013-05) Bhorat, Haroon; Stanwix, Benjamin
    Drawing on evidence from developing country studies, this paper considers several key issues. We discuss the impact of minimum wages in the developing world based on a selection of recent studies and highlight non-compliance with minimum wage laws as an important research and policy issue.
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    The Story of HIV/TB - the terrible twins
    (2010) Stanwix, Benjamin
    The rising incidence of Tuberculosis (TB) in South Africa is closely linked to the rapid spread of HIV/AIDS that has occurred over the last two decades. Compared to other developing countries in this regard South Africa faces a co-epidemic crisis which must be addressed if HIV/TB is to be fought successfully. It is no longer sufficient to focus on each disease separately while neglecting the issues arising from co-infection. When these two diseases intersect it creates serious problems for TB diagnosis and treatment that are not yet adequately dealt with in the existing treatment frameworks. Moreover, TB is the leading cause of death among AIDS sufferers. There is scope for a broader set of TB diagnostic tools to be prescribed, in particular an urgent need for cheap and accurate TB tests to replace the current 120-year-old sputum microscopy. New tests are becoming available but only for a limited group in the private sector. This paper begins by exploring the link between HIV and TB, the data reveals that a change in HIV prevalence is strongly correlated with a change in the incidence of TB. Two techniques are employed to investigate this. The result is an exceptionally high rate of co-infection in countries such as South Africa, where there is high HIV prevalence and high incidence of active and latent TB. The paper then considers why this HIV/TB overlap is such a serious problem for patients and health care workers beyond the problems caused by each disease separately. In conclusion, four broad solutions are examined which would help to address the co-epidemic and solve some of the key problems.