Middle Class Growth in South Africa

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Submitted By yogita2014
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BIENNIAL CONFERENCE OF THE ECONOMIC SOCIETY OF SOUTH AFRICA, UNIVERSITY OF THE FREE STATE, BLOEMFONTEIN, SOUTH AFRICA, 25-27 SEPTEMBER 2013 Justin Visagie justinvisagie@gmail.com Abstract This paper examines the development of the middle class in post-apartheid South Africa, using data from the 1993 Project for Statistics on Living Standards and Development, the 2000 Income and Expenditure Survey/Labour Force Survey and the 2008 National Income Dynamics Study. The affluent middle class are defined as individuals residing in a household with a per capita income of R1,400 – R10,000 per month in 2008 prices. The paper explores changes in the size of the middle class as well as the racial and gender profile of the middle class within the context of Black Economic Empowerment in South Africa. The affluent middle class experienced very modest growth over the period, only slightly ahead of population growth. There was however substantial churning in the racial composition of the middle class, with a large increase in the number of Africans accompanied by a fewer number of Whites. The gender profile of the middle class showed less conclusive evidence of transformation. The upper class similarly experienced significant racial transformation and more than doubled in size, and also accrued a higher share of total income (at the expense of the income shares of middle and lower classes).

1. Introduction South Africa’s transition to democracy in 1994 promised the beginning of a nondiscriminatory multi-ethnic regime in which money and power would no longer reside with the White minority. The growth and establishment of a multi-racial ‘middle class’ is one way of evaluating progress towards this goal. The middle class itself is considered to provide a range of key functions for the economic growth…...

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