The dynamics of poverty in the first four waves of NIDS

Type Working Paper - SALDRU Working Paper
Title The dynamics of poverty in the first four waves of NIDS
Issue 174
Publication (Day/Month/Year) 2016
We analyse the determinants of South Africans moving into and out of poverty over the first
four waves of the National Income Dynamics Study (NIDS) for the years 2008 to 2014/2015.
We focus on the balanced panel of NIDS respondents and find that a relatively high poverty
exit rate was accompanied by a substantial proportion of the population being trapped in
severe poverty. The roles of demographic versus income changes over time reveal that
changing household composition is the largest trigger of poverty entry and exit, and that
increasing income from government grants is the main trigger precipitating poverty exit for
about one quarter of our sample. Regression analysis shows that access to the labour market
within the household isthe single most important determinant of poverty entry and exit after
race. We calculate multidimensional poverty rates and find that although MPI poverty is far
lower than money‐metric poverty, being chronically MPI poor over the four waves is closely
matched by being chronically income poor.

Related studies