Commentary on Bassier and Ranchhod, ‘Can Minimum Wages Effectively Reduce Poverty Under Low Compliance? A Case Study from the Agricultural Sector in South Africa’

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Can Minimum Wages Effectively Reduce Poverty under Low Compliance? A Case Study from the Agricultural Sector in South Africa

Acknowledgements

I am grateful to Akhil Sood and Sandra Harvey for their help with clarifying the ideas presented in this commentary. Donna Auston and Steven Pressman were instrumental in shepherding the piece to publication. Finally, my sincere thanks go to the organizers and participants of the ‘Price of Wealth' workshop for enabling such a meaningful dialogue.

Disclosure Statement

No potential conflict of interest was reported by the author.

Notes

1 In the paper’s final paragraph, the authors cite a 2013 study that ‘simulat[ed] the effect of dropping all social grants in 2008 [in South Africa]’. The authors of the study found ‘that the headcount poverty rate only increases from 70% to 71%’ in response to the reduction in welfare provisions. Bessier and Ranchhod write that this finding suggests that increasing the minimum wage may have a more significant impact on reducing poverty than would social welfare provisions. It could rightly be asked whether a smaller increase in poverty due to removing welfare provisions can be fairly used as evidence for the greater relative impact of increasing wages to reduce poverty.