Gabriela Inchauste

Position: Lead economist, Poverty and Equity Global Practice

Institution: World Bank

Gabriela Inchauste is a lead economist in the Poverty and Equity Global Practice of the World Bank. She currently leads work on Fiscal and Social Policies for poverty reduction and shared prosperity, where she has been exploring the distributional impact of fiscal policy, ex-ante analysis of the distributional impacts of policy reforms, and understanding the channels through which economic growth improves labor market opportunities for poverty reduction. Her work spans fiscal policy in low-income countries, decentralization, macroeconomic shocks and the poor, the informal sector, and the role of remittances in developing countries. A Bolivian national, she holds a Ph.D. in economics from the University of Texas at Austin.

Articles

How much is inequality reduced by progressive taxation and government spending?

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Editor's Corner

What windows could BRICS open?

This year, South Africa takes over from China as the chair of BRICS grouping of countries (Brazil, Russia, India, China, and South Africa). What new opportunities for trade and development does this offer?

Although BRICS is, in the main, a political grouping rather than an economic or trade bloc, it nonetheless provides important opportunities to advance a country’s economic and trade interests, as agricultural economist, Wandile Sihlobo points out in this edition of Econ3x3.

Sihlobo explores the role that South African agriculture and agribusiness lobbies can play working through the SA BRICS Business Council. Specifically, he points out that our share of agricultural trade to the other BRICS countries is pretty small in relative terms - an average of 8% over the past 10 years in total agricultural exports of US$9,9 billion. China, the leading market, accounts for just 5% of total SA agricultural exports, while Russia accounts for just 2%. Of course, Russia’s war with Ukraine and the consequent instability may threaten even these exports. Brazil and India are negligible importers of SA agricultural goods, he writes.

It is also difficult for products such as South African wine to compete in the Chinese market as producers face import duties as high as 14%, compared with other major wine producers such as Australia and Chile, which face no tariffs. But then these countries have bilateral trade agreements with China. South Africa’s chairmanship of BRICS now provides an opportunity for the country to lobby for better access to those markets.

But it is also prudent to consider possible trade-offs other countries may want in return for better access to agricultural goods, such as in manufactured goods. This may affect the country’s localisation strategy.

Nonetheless, Sihlobo argues, there may be windows of opportunity to negotiate commodity-specific protocols with other BRICS partners, all of whom (except for South Africa) have large populations and solid economic growth prospects, equating to sustainable markets.

Of course, the country should not neglect its traditional and lucrative agricultural markets for instance in the EU and the African continent. The instability of one of the key BRICS partners at war will clearly be a negative factor but nonetheless, the SA BRICS Business Council would be wise to use this opportunity to expand trade in order to promote growth and better employment prospects at home.

In the last edition of Econ3x3, we published some unexpected good news around educational progress. Education, argued Martin Gustafsson of the Research on Socio-Economic Policy unit (ReSEP) at Stellenbosch University, is improving at a more consistent rate than we think. But because progress is slow, it often goes unnoticed.

Although basic reading and numeracy skills of South Africa’s learners are “strikingly low”, the country has been “improving at a speed that is rapid by international standards,” notwithstanding the devastating effects on education of the pandemic and lockdown.

Gustafsson explains why it is so hard to convey this message. One reason is that the focus on matric results often overshadows other measurements. But more pertinently, he argues that exams are poor indicators of educational progress.

System-wide progress, when it occurs, is “painfully slow”. But this is precisely why we need rigorous means of measurement.

Careful measurement – even of slow progress - matters because it should be an indispensable tool for policymakers and educationists. If no improvement is detectable, it could lead them to make unnecessary and disruptive changes such as changing the curriculum.

Education authorities need to pay careful attention to how progress is measured. Slow and steady steps are often ignored, but if we are serious about improving the quality of education, we need to focus on what works.

Pippa Green, March 15, 2023

Working Papers from the REDI3x3 project are available HERE

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Gabriela Inchauste

Articles

What windows could BRICS open?

READ, WRITE & REASON

Creating jobs, reducing poverty I: Why the informal sector should be taken seriously and enabled properly

Who are the middle class in South Africa? Does it matter for policy?

What is the role of manufacturing in boosting economic growth and employment in South Africa?

Adcorp’s employment and unemployment figures are not taken seriously by researchers – yet they can do much harm

Informal settlements: poverty traps or ladders to work?

Why are foreign-run spaza shops more successful? The rapidly changing spaza sector in South Africa

How much is inequality reduced by progressive taxation and government spending?

How high is graduate unemployment in South Africa? A much-needed update

A job in the informal sector reduces poverty about as much as a job in the formal sector

Who creates jobs, who destroys jobs? Small firms, large firms and labour market rigidity