The Covid-19 pandemic has forced societies around the world to make difficult trade-offs, as they try respond to the public health crisis on one hand, and to the economic and social distress arising out of it on the other. In South Africa, these combined crises have exacerbated already high levels of unemployment, deepening poverty and heightening levels of hunger and food insecurity.

To mitigate the combined health, social and economic crises stemming from the Covid pandemic, South African President Cyril Ramaphosa announced, in April 2020, a range of support measures to mitigate their impact, including emergency social protection and employment stimulus measures.

Find out more about the Extension in South Africa

This research project aims to study the local stimulus effects of South Africa's PES and national social grants program. In order to do so, it brings together a wide range of existing and new data sources, such as shopper data provided by Shoprite Checkers and programme participant data from Harambee Youth Employment Accelerator, which are securely merged while preserving individual anonymity using local tech company Omnisient’s proprietary encryption technology. 

The primary research focus will be on the multiplier effects of these two programs, that is, the effects of the programs on the economy beyond the direct impact of spending on program participants and their households.

These program-specific multiplier effects are crucial to the overall evaluation of the programs, particularly in the context of budget constraints, but are difficult to identify in a credible empirical manner given the lack of work on them in South Africa. 

In studying them, this project thus has the dual objective of characterizing the spending patterns of stimulus beneficiaries and then examining how such spending is likely to stimulate economic activity in industries further up the product supply chain. Much of the analysis proposed is descriptive and extrapolative rather than causal when it comes to quantifying multiplier effects. 

Thus, the overall goal of this research is to provide an incomplete but conservative and credible quantitative baseline for thinking about program-specific multipliers in South Africa, in an environment where such evidence is lacking.
 

The publications and webinars related to this research project are available below.

In July 2019, Infusion Knowledge Hub conducted a study on opportunities for wholesale in Stock Road in Philippi in the Western Cape Province on behalf of a large South African supermarket chain. The purpose of the study was to understand the trading environment in the informal and small business market to elicit a value-added cash and carry shopping proposition (Vawda, Prinsloo and Prinsloo, 2019). 

In June 2022, as part of a research program launched by the Presidency of South Africa and Agence Française de Développement, funded by the European Union, Infusion Knowledge Hub replicated the study to determine whether there are shifts in purchasing behaviour amongst the informal and small traders that participated in the 2019 research. In doing so, the study aimed to provide granular data on shifts in the informal and small traders’ operating environment around Stock Road in Philippi between July 2019 and June 2022. In addition, the research investigated the spending patterns of 30 Social Relief Distress (SRD) grant recipients and 31 Basic Education Employment Initiative (BEEI) participants.

Find out more about the Extension in South Africa

This new research project aimed to contribute to the body of knowledge on the impact of social protection and employment stimulus measures on the formal and informal economies. 

Two studies analysing the local effects of the South African Presidential Employment Stimulus Initiative (PES) and the national social grants programme were produced: 

1. One study, presented in note form, that builds on Infusion's long-standing relationship with Shoprite to allow SALDRU to use Shoprite's customer data to explore the shopping habits of stimulus beneficiaries. The focus was on unpacking purchasing data related to beneficiaries who receive the Distressed Social Relief Grant and those who are part of the school assistants programme managed by the Department of Basic Education (DBE).
2. A research paper that details through descriptive and inferential statistical analysis the transfer to a mobile application, called NECTA, of a landmark study by Infusion and Shoprite conducted among informal vendors and "Spaza" stores in Philippi. This data provides an overview of what has been happening in these businesses since July 2019 (the date of the initial project), as well as an opportunity to see how the new "post-stimulus" environment is impacting the trade and decision-making of these business entities as well as some of their customers.
    

You will find below the research paper related to this project: 

• Measuring stimulus effects around Stock Road in Philippi on the Western Cape.