IDEAS home Printed from https://ideas.repec.org/p/avg/wpaper/en16322.html
   My bibliography  Save this paper

Stimulus effects of a large public employment programme

Author

Listed:
  • Ihsaan Bassier
  • Joshua Budlender

Abstract

We characterize the spending and factor income effects of a large public employment programme in South Africa. We match anonymized participant IDs with weekly individual-level sales data from one of the country’s largest retailers, and estimate the treatment effect on participant spending at the retailer. Our event studies show flat pretrends with a sharp increase in average spending of 15%. Effects are substantially higher for nonfood products that likely have higher income elasticities, and there are smaller positive effects of 4% that persist in the months after the end of the programme. We use administrative firm data, input-output tables and a survey of participant spending to extrapolate effects of the increase in retailer sales on domestic factor incomes, particularly highlighting effects on the national and local wagebill. Our estimates contribute to evidence that government spending programmes benefit non-programme employment and wages.

Suggested Citation

  • Ihsaan Bassier & Joshua Budlender, 2024. "Stimulus effects of a large public employment programme," Working Paper a09be470-a23f-4594-b51a-f, Agence française de développement.
    • Handle: RePEc:avg:wpaper:en16322
    as

    Download full text from publisher

    File URL: https://www.afd.fr/sites/afd/files/2024-01-03-36-39/Stimulus-effects-of-a-large-public-employment-programme.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Martin Abel, 2019. "Unintended Labor Supply Effects of Cash Transfer Programs: New Evidence from South Africa’s Pension," Journal of African Economies, Centre for the Study of African Economies, vol. 28(5), pages 558-581.
    2. Maya Goldman & Ihsaan Bassier & Joshua Budlender & Lindi Mzankomo & Ingrid Woolard & Murray Leibbrandt, 2021. "Simulation of options to replace the special COVID-19 Social Relief of Distress grant and close the poverty gap at the food poverty line," WIDER Working Paper Series wp-2021-165, World Institute for Development Economic Research (UNU-WIDER).
    3. Karthik Muralidharan & Paul Niehaus & Sandip Sukhtankar, 2023. "General Equilibrium Effects of (Improving) Public Employment Programs: Experimental Evidence From India," Econometrica, Econometric Society, vol. 91(4), pages 1261-1295, July.
    4. Thibaut Lamadon & Magne Mogstad & Bradley Setzler, 2022. "Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market," American Economic Review, American Economic Association, vol. 112(1), pages 169-212, January.
    5. Marianne Bertrand & Sendhil Mullainathan & Douglas Miller, 2003. "Public Policy and Extended Families: Evidence from Pensions in South Africa," The World Bank Economic Review, World Bank, vol. 17(1), pages 27-50, June.
    6. Duncan Pieterse & Elizabeth Gavin & C. Friedrich Kreuser, 2018. "Introduction to the South African Revenue Service and National Treasury Firm‐Level Panel," South African Journal of Economics, Economic Society of South Africa, vol. 86(S1), pages 6-39, January.
    7. Anderson, Siwan & Eswaran, Mukesh, 2009. "What determines female autonomy? Evidence from Bangladesh," Journal of Development Economics, Elsevier, vol. 90(2), pages 179-191, November.
    8. Vimal Ranchhod, 2006. "The Effect Of The South African Old Age Pension On Labour Supply Of The Elderly," South African Journal of Economics, Economic Society of South Africa, vol. 74(4), pages 725-744, December.
    9. Ihsaan Bassier & Joshua Budlender, 2021. "Methods for credible evaluation of programme stimulus effects in South Africa," SALDRU Working Papers 278, Southern Africa Labour and Development Research Unit, University of Cape Town.
    10. Beegle, Kathleen & Galasso, Emanuela & Goldberg, Jessica, 2017. "Direct and indirect effects of Malawi's public works program on food security," Journal of Development Economics, Elsevier, vol. 128(C), pages 1-23.
    11. Johannes Hermanus Kemp, 2020. "Empirical estimates of fiscal multipliers for South Africa," WIDER Working Paper Series wp-2020-91, World Institute for Development Economic Research (UNU-WIDER).
    12. Kate Ambler, 2016. "Bargaining with Grandma: The Impact of the South African Pension on Household Decision-Making," Journal of Human Resources, University of Wisconsin Press, vol. 51(4), pages 900-932.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ihsaan BASSIER & Joshua BUDLENDER, 2024. "Methods for Credible Evaluation of Programme Stimulus Effects in South Africa," Working Paper 53315978-8164-44f9-8141-5, Agence française de développement.
    2. Kacker, Kanishka, 2019. "Social transfers and labor supply: Long run rvidence from South Africa," MPRA Paper 99044, University Library of Munich, Germany.
    3. Bassier, Ihsaan & Budlender, Joshua & Zizzamia, Rocco & Leibbrandt, Murray & Ranchhod, Vimal, 2021. "Locked down and locked out: Repurposing social assistance as emergency relief to informal workers," World Development, Elsevier, vol. 139(C).
    4. Manea, Roxana Elena & Piraino, Patrizio & Viarengo, Martina, 2023. "Crime, inequality and subsidized housing: Evidence from South Africa," World Development, Elsevier, vol. 168(C).
    5. Independent Evaluation Group, 2014. "Social Safety Nets and Gender : Learning from Impact Evaluations and World Bank Projects," World Bank Publications - Books, The World Bank Group, number 21365.
    6. Agüero,Jorge M. & Fasola,Eniola, 2022. "Distributional Policies and Social Cohesion in a High-Unemployment Setting," Policy Research Working Paper Series 10103, The World Bank.
    7. Alessandro Tondini & Cally Ardington & Ingrid Woolard, 2017. "Public pensions and elderly informal employment: Evidence from a change in retirement age in South Africa," SALDRU Working Papers 206, Southern Africa Labour and Development Research Unit, University of Cape Town.
    8. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 117999, London School of Economics and Political Science, LSE Library.
    9. von Fintel, Dieter & Pienaar, Louw, 2016. "Small-Scale Farming and Food Security: The Enabling Role of Cash Transfers in South Africa's Former Homelands," IZA Discussion Papers 10377, Institute of Labor Economics (IZA).
    10. Vimal Ranchhod, 2017. "Household responses to the cessation of grant income: The case of South Africa's Old Age Pension," SALDRU Working Papers 213, Southern Africa Labour and Development Research Unit, University of Cape Town.
    11. Bergolo, Marcelo & Galván, Estefanía, 2018. "Intra-household Behavioral Responses to Cash Transfer Programs. Evidence from a Regression Discontinuity Design," World Development, Elsevier, vol. 103(C), pages 100-118.
    12. Simon Franklin & Clément Imbert & Girum Abebe & Carolina Mejia-Mantilla, 2024. "Urban Public Works in Spatial Equilibrium: Experimental Evidence from Ethiopia," American Economic Review, American Economic Association, vol. 114(5), pages 1382-1414, May.
    13. Berg, Erlend, 2013. "Are poor people credit-constrained or myopic? Evidence from a South African panel," Journal of Development Economics, Elsevier, vol. 101(C), pages 195-205.
    14. Bagga,Aanchal & Holmlund,Marcus Erik & Khan,Nausheen & Subha,Mani & Mvukiyehe,Eric & Premand,Patrick, 2023. "Do Public Works Programs Have Sustained Impacts ? A Review of Experimental Studies from LMICs," Policy Research Working Paper Series 10471, The World Bank.
    15. Xi Chen, 2017. "Old age pension and intergenerational living arrangements: a regression discontinuity design," Review of Economics of the Household, Springer, vol. 15(2), pages 455-476, June.
    16. Sarah Baird & David McKenzie & Berk Özler, 2018. "The effects of cash transfers on adult labor market outcomes," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 8(1), pages 1-20, December.
    17. Bhanot, Syon P. & Han, Jiyoung & Jang, Chaning, 2018. "Workfare, wellbeing and consumption: Evidence from a field experiment with Kenya’s urban poor," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 372-388.
    18. Chen, Xi, 2015. "Old-Age Pension and Intergenerational Living Arrangements," IZA Discussion Papers 9482, Institute of Labor Economics (IZA).
    19. Maria Laura Alzua & Natalia Cantet & Ana C Dammert & Damilola Olajide, 2024. "The Well-being Effects of an Old-Age Pension: Experimental Evidence for Ekiti State in Nigeria," Journal of African Economies, Centre for the Study of African Economies, vol. 33(3), pages 240-270.
    20. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 121970, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    Afrique du Sud;

    JEL classification:

    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:avg:wpaper:en16322. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AFD (email available below). General contact details of provider: https://edirc.repec.org/data/afdgvfr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.