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10 CHAPTER 1


Second, we analyze household behavior related to human capital invest- ment. In this area, we focus on dynamic human capital production, from early- childhood nutrition intake to schooling investments and attainment, and on adolescents’ transition to the labor market. Even at this stage of the analy- sis, it is important to integrate institutional factors and observed household behavior to achieve a comprehensive understanding.


In South Africa, access to quality education is still highly unequal across population groups and locations, although the situation has been changing. In the transition from apartheid to a democratic education system, two milestones stand out: the 1996 South African School Act and the 1998 Norms and Standards for School Funding. These two sets of rules provided basic guidelines to departments of education at the national and provincial levels. More recently, South Africa introduced a revised set of Norms and Standards to promote more progressive fiscal interventions in the school system. As described in Part 1, however, there still remain discrepancies in access to quality education across population groups and communities (where population groups remain locally clustered). To understand institutional con- straints, the two key dimensions are introduced.


The first dimension is population groups. Historically there have been four politically defined population groups in the country: white, colored, Indian/ Asian, and African. The majority of the population is African. Under apartheid, Africans had semiautonomous homelands where they governed and received almost no support from the white central government. Public schools were also governed by different education ministries that were separated by popu- lation group and homeland. It has been important to investigate the conver- gence in access to quality education across population groups. The second dimension is location. Since population groups were segre- gated in residential locations under apartheid, their schools were also segregated by location. For example, African schools were located in pre- dominantly African communities. Therefore access to quality education has a spatial dimension. Since commuting long distances to school is not possible for many children owing to the substantial financial and time costs involved, accessibility to good schools depends on their spatial distribution (and on changes to that distribution, given past conditions).


In Part 2 findings on household behavior using micro panel data are reported. In particular, this part examines the dynamic nature of human capital investments and formation, from early-childhood growth (nutrition intake), to schooling investments, to adolescents’ transition to the labor mar- ket. Chapter 4 focuses on dynamic human capital production in which early- stage investment can have long-term implications for schooling outcomes (and therefore potentially labor market outcomes).


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