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SpatialInequalityinSouth
Africa:CausesandPolicy
Options
SergiiMeleshchukandJohannaSchauer
SIP/2026/018
IMFSelectedIssuesPapersarepreparedbyIMFstaffas
backgrounddocumentationforperiodicconsultationswith
membercountries.Itisbasedontheinformationavailableat
thetimeitwascompletedonJanuary21,2026.Thispaperis
alsopublishedseparatelyasIMFCountryReportNo26/35
2026
MAR
©2026InternationalMonetaryFundSIP/2026/018
IMFSelectedIssuesPaper
AfricanDepartment
SpatialInequalityinSouthAfrica:CausesandPolicyOptions
PreparedbySergiiMeleshchukandJohannaSchauer
AuthorizedfordistributionbyDeliaVelculescu
March2026
IMFSelectedIssuesPapersarepreparedbyIMFstaffasbackgrounddocumentationforperiodic
consultationswithmembercountries.Itisbasedontheinformationavailableatthetimeitwas
completedonJanuary21,2026.ThispaperisalsopublishedseparatelyasIMFCountryReportNo26/35
ABSTRACT:SouthAfricaexhibitsoneofthehighestlevelsofincomeinequalityglobally,reflectingpersistent
spatialexclusion.Thispaperexaminestheextentandcausesofspatialinequalityusinghouseholdmicrodata,
microsimulations,andastructuralspatialgeneral-equilibriummodel.Themicrodataanalysisindicatesthat
inequalitywithin(ratherthanacross)urbanandruralareasaccountsforthemajorityofoverallinequality,with
longcommutingtimesstronglyassociatedwithhigherunemploymentandlowerincomes.Thesimulation
analysissuggeststhatreducingcommutingcostscanmeaningfullylowerunemploymentandinequality.The
structuralmodelingresultspointtotranspor
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