The Capability Threshold: Re-examining the definition of the middle class in an unequal developing country

Type Working Paper - IZA Discussion Papers
Title The Capability Threshold: Re-examining the definition of the middle class in an unequal developing country
Author(s)
Issue 9523
Publication (Day/Month/Year) 2015
URL http://www.econstor.eu/bitstream/10419/125044/1/dp9523.pdf
Abstract
In a polarised and highly unequal country such as South Africa, it is unlikely that a definition
of the middle class that is based on an income threshold will adequately capture the political
and social meanings of being middle class. We therefore propose a multi-dimensional
definition, rooted in the ideas of empowerment and capability, and find that the ‘empowered
middle class’ has expanded significantly since 1993 also across vulnerable subgroups such
as blacks, female-headed households and rural inhabitants. It also is much larger than when
measured in terms of income. Differing trends between the middle class defined based on
income and based on capabilities is attributed to improved capabilities have not been
rewarded with a proportional increases in access to the labour market. It is disconcerting that
links to the labour market improved only slightly and this is attributed to sluggish labour
market growth and low quality of education. We find that the middle class tend to have lower
expectations around social mobility than the vulnerable. It is concerning that vulnerable
individuals harbour unrealistically high expectations of the social mobility of the households
and do not understand the determinants of social mobility and labour market prospects –
possibly due to a mixture of heightened expectations following the political transition, but also
the continued disconnection and marginalisation of vulnerable subpopulations from the
mainstream economy.

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