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31 August 2020 | Story André Damons | Photo Supplied
Prof Ivan Turok
Prof Ivan Turok

The number of people infected by the coronavirus is linked to the density of urban living. South Africa’s townships and informal settlements are bearing the brunt of the disease, on top of all their existing problems of unemployment, poverty, hunger, and crime. This is a disturbing situation and demands greater attention across society.

This is according to Prof Ivan Turok from the Human Sciences Research Council (HSRC), the Department of Economics and Finance, and the Centre for Development Support at the University of the Free State (UFS), who has recently been awarded a Research Chair in City-Region Economies at the UFS by the South African Research Chairs Initiative (SARChI).

Prof Turok was part of a webinar discussion on ‘Urban Living Post-COVID-19’ with Dr Geci Karuri-Sebina – who manages the research programme at South African Cities Network and who has two decades’ experience working and publishing in the fields of urban development, innovation, and foresight – and Mr Thireshen Govender, architect and founder of UrbanWorks. They analysed how COVID-19 challenges urban living, social distancing, and the de-densification of cities as South Africa heads towards 70% of its population living in urban areas.

According to Prof Turok, urban density has been blamed for the spread of the virus. “The fear of people crowding together has caused negative reactions from government, from business, and from households. This is unlikely to be a short-lived, temporary phenomenon. It will be with us for some time to come.”

“The virus poses an ongoing risk to society, with the prospect of second and third waves taking hold. A lockdown could be re-imposed and further efforts could be made to enforce distancing and de-densification of cities, particularly our densest settlements,” said Prof Turok.

 

De-risking urban density

There was a simple but compelling idea at the heart of his presentation, which should also be “at the heart of a more effective and inclusive response to the pandemic”. At the moment, the government’s response to the crisis facing our poorest communities is uninspiring. “We need a more positive vision for the future than wearing masks and washing our hands.”

“We need to be bolder and more imaginative about de-risking urban density. In other words, making crowded neighbourhoods safer and more secure for people to live in. Density poses multiple risks to residents. How do we reduce these risks in ways that generate wider benefits, rather than business as usual – forcing people to change their behaviour and follow protocols?”

With reference to New York, which was severely affected by the virus, Prof Turok showed that it was not density per se that was the problem, but rather the type of density. The densest part of the city (Manhattan) was far less affected by the virus than poorer outlying communities. “This gives us a clue that more floor space in taller buildings helps to prevent crowding and makes density more liveable,” said Prof Turok.

The reality in South Africa is also different when you drill down and distinguish between different kinds of places. Big cities have been affected worse than towns and rural areas – in terms of the incidence of infections and the number of deaths. Within cities, there have been far more problems in the townships and informal settlements than in the suburbs. In Cape Town, for example, the southern and northern suburbs and the central city have been barely affected by the virus. However, infections have been very high on the Cape Flats, including Khayelitsha, Langa, Gugulethu, Philippi, and Mitchells Plain.

“Population densities in some of these areas are more than 100 times higher than in the affluent suburbs. The differences are very striking.”

“Incomes on the Cape Flats are also much lower than elsewhere in the city. So, there is a correspondence between density and the disease, unlike New York,” says Prof Turok.

All the discussions about the pandemic so far has focused on the negative aspects of urban density for the risk of transmission. This ignores all the benefits of dense urban living. Intense human interaction fosters learning and creativity, which raises productivity and innovation. Concentrated populations generate economies of scale in the provision of infrastructure and institutions such as universities. Cities give firms greater choice of workers and vice versa.

 

Pure population density and economic density

Prof Turok continued by saying that physical distancing can be socially and economically damaging. “Attempts to force people apart through de-densification undermine all kinds of personal networks, weaken the social fabric of communities, and erode the economic advantages of proximity that are so important for cities.”

“We need to understand that people crowding together in dense informal settlements is a symptom of something more fundamental, namely poverty. The pressure on land reflects the fact that low-income households can’t afford the space standards of middle- and upper-income groups. Forcing people apart (or to stay home) to reduce the risk of transmission just treats the symptoms of the problem. It cannot be a lasting solution. It doesn’t build resilience to confront the multiple challenges facing poor communities,” said Prof Turok.

A key part of a lasting solution can be summed up as building economic density. This involves increasing investment in two- or three-storey buildings to give people more living space and to free up land at ground-floor level to accommodate essential infrastructure and more public space for markets and social interaction. A better living and working environment would strengthen community resilience to public-health problems and promote all-round development. The idea of economic density offers a practical vision that can inspire hope in a better future, rather than the status quo of wearing masks in crowded places.

“We need to de-risk urban density through tangible investment, rather than forced distancing or dispersal. This will help to bring about far-reaching improvements to people’s lives in cities. At the moment, the lack of economic density in impoverished communities is a much bigger problem than excessive population densities.”

News Archive

Inaugural lecture: Prof. Phillipe Burger
2007-11-26

 

Attending the lecture were, from the left: Prof. Tienie Crous (Dean of the Faculty of Economic and Management Sciences at the UFS), Prof. Phillipe Burger (Departmental Chairperson of the Department of Economics at the UFS), and Prof. Frederick Fourie (Rector and Vice-Chancellor of the UFS).
Photo: Stephen Collet

 
A summary of an inaugural lecture presented by Prof. Phillipe Burger on the topic: “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

South African business cycle shows reduction in volatility

Better monetary policy and improvements in the financial sector that place less liquidity constraints on individuals is one of the main reasons for the reduction in the volatility of the South African economy. The improvement in access to the financial sector also enables individuals to manage their debt better.

These are some of the findings in an analysis on the volatility of the South African business cycle done by Prof. Philippe Burger, Departmental Chairperson of the University of the Free State’s (UFS) Department of Economics.

Prof. Burger delivered his inaugural lecture last night (22 November 2007) on the Main Campus in Bloemfontein on the topic “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

In his lecture, Prof. Burger emphasised a few key aspects of the South African business cycle and indicated how it changed during the periods 1960-1976, 1976-1994 en 1994-2006.

With the Gross Domestic Product (GDP) as an indicator of the business cycle, the analysis identified the variables that showed the highest correlation with the GDP. During the periods 1976-1994 and 1994-2006, these included durable consumption, manufacturing investment, private sector investment, as well as investment in machinery and non-residential buildings. Other variables that also show a high correlation with the GDP are imports, non-durable consumption, investment in the financial services sector, investment by general government, as well as investment in residential buildings.

Prof. Burger’s analysis also shows that changes in durable consumption, investment in the manufacturing sector, investment in the private sector, as well as investment in non-residential buildings preceded changes in the GDP. If changes in a variable such as durable consumption precede changes in the GDP, it is an indication that durable consumption is one of the drivers of the business cycle. The up or down swing of durable consumption may, in other words, just as well contribute to an up or down swing in the business cycle.

A surprising finding of the analysis is the particularly strong role durable consumption has played in the business cycle since 1994. This finding is especially surprising due to the fact that durable consumption only constitutes about 12% of the total household consumption.

A further surprising finding is the particularly small role exports have been playing since 1960 as a driver of the business cycle. In South Africa it is still generally accepted that exports are one of the most important drivers of the business cycle. It is generally accepted that, should the business cycles of South Africa’s most important trade partners show an upward phase; these partners will purchase more from South Africa. This increase in exports will contribute to the South African economy moving upward. Prof. Burger’s analyses shows, however, that exports have generally never fulfil this role.

Over and above the identification of the drivers of the South African business cycle, Prof. Burger’s analysis also investigated the volatility of the business cycle.

When the periods 1976-1994 and 1994-2006 are compared, the analysis shows that the volatility of the business cycle has reduced since 1994 with more than half. The reduction in volatility can be traced to the reduction in the volatility of household consumption (especially durables and services), as well as a reduction in the volatility of investment in machinery, non-residential buildings and transport equipment. The last three coincide with the general reduction in the volatility of investment in the manufacturing sector. Investment in sectors such as electricity and transport (not to be confused with investment in transport equipment by various sectors) which are strongly dominated by the government, did not contribute to the decrease in volatility.

In his analysis, Prof. Burger supplies reasons for the reduction in volatility. One of the explanations is the reduction in the shocks affecting the economy – especially in the South African context. Another explanation is the application of an improved monetary policy by the South African Reserve Bank since the mid 1990’s. A third explanation is the better access to liquidity and credit since the mid 1990’s, which enables the better management of household finance and the absorption of financial shocks.

A further reason which contributed to the reduction in volatility in countries such as the United States of America’s business cycle is better inventory management. While the volatility of inventory in South Africa has also reduced there is, according to Prof. Burger, little proof that better inventory management contributed to the reduction in volatility of the GDP.

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