The impact of educational attainment on household poverty in South Africa: A case study of Limpopo province¹

1 This article is a revised version extracted from F. A. Wanka’s, M.Com (Economics) dissertation on ‘the impact of educational attainment on household poverty in South Africa: a case study of Limpopo Province’ (2014), under the supervision of Prof R. Rena, submitted to the Department of Economics, University of the Western Cape, South Africa.

Abstract

The provision of education in South Africa during the apartheid regime was poor, particularly for the African population and especially those living in the homelands. This has hindered those lacking the required skills from obtaining lucrative employment and earning prospects. The Income and Expenditure Survey data conducted by Statistics South Africa, for the period 1995, 2000, 2005/06 and 2010/11 were used to carry out this investigation. The official absolute income poverty lines of R3864 (lower bound) and R7116 (upper bound) per annum in 2000 prices were used. In order to establish the relationship between education and poverty status of an individual, a probit regression model was used. This model helped to determine the relationship between the head of a household’s level of education and the poverty status of the household. The results obtained reveal that there is a strong tendency for lower educational attainment to be associated with a higher prevalence of household poverty. This study aims at investigating the impact of a household head’s educational attainment level on the poverty status of the individual household in South Africa, using Limpopo province as a case study. This study seeks to establish whether education has an effect on poverty alleviation in Limpopo province.

Keywords:

• educational attainment
• poverty
• human capital
• household head
• households employment and earnings
• signalling theory
• South Africa
• Limpopo province

ORCID

Ravinder Rena http://orcid.org/0000-0002-4156-8693

Notes

1 This article is a revised version extracted from F. A. Wanka’s, M.Com (Economics) dissertation on ‘the impact of educational attainment on household poverty in South Africa: a case study of Limpopo Province’ (2014), under the supervision of Prof R. Rena, submitted to the Department of Economics, University of the Western Cape, South Africa.

2 According to Van der Berg (2008), absolute poverty is the lack of financial resources needed to sustain a given minimum standard of living, while relative poverty is poverty that is mostly determined by the community in which an individual lives. Absolute poverty is rare in developed countries, but predominant in underdeveloped countries (Raffo et al. 2009).

3 Govender et al. (2007) stated that chronic poverty is poverty whereby at each successive observation people are seen to be poor, while temporary poverty means moving from being poor to non-poor.