 So that was that was fun Why don't we open up for questions and comments and the presenters should also feel free if they have Comments and questions for each other Any questions or comments? Thanks Thanks very much wonderful set of papers. I was I was Struck by the by the use of the term rinse in both of the country study papers and It strikes me that that's you know, maybe I don't know the literature that well So maybe everybody's taken that on board, but when you start talking about the consequences of these policies You know when you do standard economic analysis of the of the losses of the downside then often people model this as a sort of highly competitive Economy you know economic situation and But both of both of you were saying well, that's just not the right way to anchor the thing at all and in fact Iabonga's presentation was very strong on on Concentration and actually how the industrial structures in your case, you know Work And I was you know, so it I mean So maybe you can respond to that it just struck me that that's a crucial point almost to make You know conceptually in in working on it. Okay, but how does one evaluate? the these policies in terms of their impacts and you've got to ground that in the actual Reality of what those so so Iabonga spoke about the long history of racial capitalism in South Africa. That's not just a footnote Because that imposed a certain structure on the on the whole enterprise within which you then try and insert a Very complicated What Edmund called like a very rich and complicated and intersecting type of a process So anyway, that's just maybe you want to pick up on that and and talk about it But it's just that you know the sort of stylized fact of private sector markets Are increasingly being analyzed as monopsony. So this concept of a rent is embedded in the very working of the of that market before any policies come to play And then I just had a much more specific comment for for Edmund, you know You spoke about the education and the educational expansion But then you also in the beginning you also framed the discussion in terms of universalism versus targeting And I was wondering whether the education policies are Part of the affirmative action or whether they Whether they're more universalist policies that are highly relevant to You know because that was the big success and it really undergirded the support of the affirmative action The role and the capability of the state come out as being really important in the implementation of of the policies Which then affects the the politics there, you know, which just rolls up with the politics of how they're implemented So I I wonder your thoughts on that I mean what aspects of the state are most important and then I think for Simona It's maybe something we didn't capture in the in the database I mean there's certainly indicators of the state that we could bring in but maybe it's something We want to think about incorporating Why don't we start with those and then we'll open up for more questions or comments if there are We'll go in the order of speaking So Edmund you're or Terrence you're first Thank you for your comments on the rent. I did end my presentation by arguing why must be focused on equity distribution When we talk about affirmative action and it's precisely because the focus is on equity redistribution To my mind we see all the problems coming up in the market inefficiencies and also a sense of alienation the rise of The diaspora leaving the country which is detrimental to the country The people who leave are the people with the most what I call class resources They have education. They have wealth. They have enough ability to go and work anywhere in the world and Be very productive and other country is the beneficiary so here I would If my response to your question, I would first actually post this point to Simone too What is our definition of affirmative action? I? Want to be clear on that When we say affirmative action, what exactly are we talking about affirmative action in what way positive discrimination? Or is there some other form of affirmative action and The definition has to be clear once the definition is clear. We're introducing the policy for what purpose are we introducing the policy? Yes, two days ago. We heard a paper on Chile Chile where the focus was clearly on education Yes, bring more women into the engineering faculty in the university. That's it Now that's not going to cause a lot of tension in the country No, I'm serious We're not going to have rise on the streets because of that But if you have affirmative action, which talks about wealth redistribution, then you're going to have problems Now those are the questions we got to ask ourselves if our focus is rent distribution to bring about equity in distribution of wealth then This comes to Rachel's question What is the form of state intervention? Because the way the state intervenes to redistribute wealth becomes crucial in what form are you intervening? Is it transparent and accountable? Now when the state intervened in Malaysia They created public enterprises that targeted rural areas the state went and did the work for them Develop the land redistributed the land and let them live on the land and develop the land thereafter And it became a new middle class That form of state intervention is not going to cause problems In fact that kind of distribution redistribution looking at land in rural areas, which would not otherwise be Well employed is in fact beneficial to the country and it helps landless people to take people who are landless and put them there And they develop the land very important point So how the state intervenes to my mind Rachel is very important That's one form the second point the second form is on the point on education You raised this point of universal is universalism was a target targeted type That's a very important point because the debate now that is going on is should we have H.I. and V.I. Paul targeted and universal universalism together Don't need there's no need to make a segregation do it simultaneously in education what Malaysia did was we had universal education High-quality universal education and that carried on Even when affirmative actions started But meanwhile they created a new bunch of Residential schools put the best teachers there took the poorest kids and Send them to those schools to get the highest quality education So while that was going on the high-quality universal education was also going on you see the point And it worked Well, they created a new they they transformed a poor community into a new middle class Meanwhile the rest of the nation was still getting high-quality education Until that point in time when there was to erase this issue of Institutional decline which comes to the question of public employment Public employment in the universities and the schools and the bureaucracy It will lead to institutional decline then the schools are no longer universal education no longer becomes important You're not getting high quality education And so private education becomes and then everyone wants to go to those targeted schools Even the elites want to send their children to the targeted schools because it's free education as opposed to going to private education These are all the outcomes we got to look at because it speaks to the question again I come back to Rachel's point form of state into which intervention access Who has access is important should rich children have access to the targeted schools or just because they are From that ethnic group. No of course not But unfortunately, that's not how The policy is structured We come back to the policy the policy. How is it structured? What's its name? What's its focus? I think those are the issues we need to get into because when I give a talk on affirmative action deal Tell me this is not affirmative action. I don't know what you're talking about Yeah, and you had a list of so many countries where you classified them under affirmative action And I was so happy when Simone said it's not necessarily true of affirmative action. We're just looking at discrimination Where discrimination occurs? That's not affirmative action So these things we need to sort out. I really look forward to your work. It's so ambitious It's really ambitious Honestly, and I wish you well on that but these are the points that These are the points we really need to get into so that when we do implement affirmative action It is seem to progressive policy We implemented properly. We know exactly what we're doing and where it is focused on I feel the focus should not be on the economy you saw Malaysia and South Africa same problem the focus should be on education Yeah, I mean just to maybe pick up on something Terence is raising. I think even in policy design a Specific focus on race without embedding class is a dead end And I think we've seen this. I mean the example of Malaysia You see it also in many examples of post-colonial African societies This whole idea of Africanizing the bureaucracy Africanizing the university is often used opportunistically by certain elites from You know beneficiary ethnic groups if I can call it that To pursue their own very narrow projects Under the cloak of you know the race the group and so on and I think and I think we really need to be cautious of that You know Murray, I mean I think you raise a very difficult question. They are around rents and I think rents even in the theoretical framework arise from Starting or origin assumptions around how markets function right this idea that price embeds Certain competitive elements or you know factor payments to different factors of production And I think for me what is often helpful is to Separate two kinds of rents. So there are rents that arise from specific peculiarities of market structure Which in some cases might arise as a result of policy sanctioned Issues and in some cases they don't they arise out of other things that have little to do with policy But interface with policy and I think be in particular is a policy sanctioned rent You know just like the wage premium to unskilled Africana workers during apartheid was a policy sanctioned rent And I think you know it's quite clear that the operative mechanisms of both might be the same So it might be markups. It might be premium. It might be welfare or deadweight losses But really the origin of the rent itself. I think is also critical And I think one of the things that we really start to see even in policy sanctioned rents around being If your procurement design Leaves a lot to chance you end up having a lot of situations one of the things I lament is this middleman phenomenon If you act like you discovering the market for the first time every financial year you are incentivizing middle persons you incentivizing I a bonga to come in and You know import as much as I can because there are two things that you prioritize my race and the best price And effectively what that does is that it sometimes diverges from your other Economic objectives, which might be to reindustrialize the economy broad in your industrial base and so on so so I do think that it's important for us to use the rent lens and Even this idea of competitive markets as a starting point irrespective of the issues I might have with that as a mechanism for a thorough going policy reform that says Actually, you might want to shift how you procure away from this piecemeal approach to a much more targeted framework That you lock in for maybe a longer period so that you can begin to evaluate and monitor that you know one of the funniest things is that if you go to state-owned companies and Municipalities none of them can actually tell you over the last ten years the frequency of the things they procured None of them They can't tell you even if my authority is to provide water and sanitation In the mix of products and services in the provision of water and sanitation What did I procure more was it PVC pipes? Was it VIP toilets? What was it none of them keep that data and I think it links to the second part of your your question Which is you know, what are these capabilities that we want in the state? And I think we really need to get to a granular in a detailed level I really think the market intelligence and even that kind of intelligence on what it is that we buy is critical Especially in South Africa where the state is such a dominant buyer Even when compared to the private sector, I think the other element is This idea of participatory social dialogue, you know one of the people I interviewed for the study was the social dialogue unit at Sun Roll and They can tell you how Costly it has been to not go into a community and consult Because you end up creating an environment where you open up space for opportunistic elements and violent elements in that community to say look They came and built a billion rand road here, and they didn't employ any of you and That creates a certain perverse incentive I think the other element of course is around this idea of embedded autonomy and it comes across quite strongly in the developmental state literature It's so funny how certain organs of state have become captured and I don't talk about state capture in the gupta sense now right, but captured by groups that have the Political social capital and the capacity for violence, especially at a municipal and You know SOC level where you know And it's also because sometimes the mayor is the branch chairperson of the organization And I might be a big power broker inside of the local ANC branch But what effectively ends up happening is that there is a very strong pandering to the sentiment of those who yield a lot Considerable amount of power because even my stay as a mayor is reliant Not necessarily on my own performance But effectively on the distribution of power in some of those primordial power bases that I was talking about You know the ethno-national forms of organization the political party and so on And I do think that you know what the national development plan had spoken about which is insulating particular Spheres of the state from direct political influence might be a necessary But not a sufficient condition to deal with this and part of it is to really build this embedded autonomy in a clear sense of what the state's Vision and future might look like and I think it's a real pity that we really don't even have a Long-term vision and a plan around which we can coalesce. I mean 2030 is here. So, you know, what happens after 2030 Okay Yeah, thanks. I think regarding the state capacity Of course our database would allow to allow with other Data that has information on state capacity comes down to how do you measure this which I think is a discussion in itself But I think the more difficult part it is or that has been cracking our brains for quite some time is how do we capture the Evolution of a policy and we try to do this in the beginning Trying to do okay five years after the policy and so on it proved really difficult and I think something that the Malaysian case has shown is It can matter a lot for how you assess the policy basically and the same at what time should we assess state capacity? Is it at implementation? Is it at what point should we even merge it in if you wanted to and I think those are the things We will still need to to tackle to some extent and then just on the comment regarding whether the policy targets Wells distribution or Maybe has a more direct and like an only education I think in the end what affirmative action policies do is to redistribute opportunities like they the moment Opportunities are limited and you create some for some there will be others who are losing out It's kind of this redistribution effect of it. It's kind of hard to circumvent of course you might have you might say that you're The non-marginalized group have better outside options So in the end it doesn't have such a strong effect But it will depend and it will almost always somehow affect the world's distribution just in more direct or more indirect way And I think governments have just taken different approaches and how to frame those policies and how direct They would be about the redistributive effect of them And I think this has mattered a lot of for how they are perceived in the public domain And it's part of what has made our job quite difficult because you would find Countries like Singapore who very much emphasize the merit character, but at the same time to have a redistributive element It just a frame very differently for example, or you have the Brazilian policy where it was mainly There were education quota for racial groups, and then it was made to be a quota for public Students coming from public schools, which are maybe mainly black, but it's not any more racial targeted Even though it may be benefits a certain ethnic group and this you might have this other social redistributive programs And you might have like cash transfers going to the poor's which then again benefit certain groups targeting Horizontal inequalities and kind of where do you make the cut kind of and how do we only capture those that are directly targeted? What about indirect targeting etc. And I think it's those Yeah, we will still need to to deal with but thank you I just like to be one more point on this issue of state capacity Before we can talk about state capacity. We must understand the nature of the state What kind of state are we talking about? Is it a strong state a weak state? Even talk now about a dysfunctional state who has Control over the state is the state controlled by oligarchs through political financing It's a state controlled by the military is a trade controlled by hegemonic party. What is the level of democracy? In the sense of defined as devolution of power to ensure checks and balances in place All these matter Before we can talk about state capacities to implement What also matters is we have to look at the public sector the bureaucracy the capacity of the bureaucracy to Conceive policies and change it. It matters policies can't be static They have to change as an economy develops the kind of policy Introduce what a country was developing in the kind of policy I have in the countries now at a highly developed state Will be very different and in the process most countries will tinker with their policies as they develop or some cases They may have wholesale change those things to matter Has the bureaucracy the capacity to bring about the changes in an economy or in the policy? Framework to deal with the changes that are happening in the economy the economy is not stagnant does The bureaucracy have the ability to bring about policy changes as society evolves as society moves up the social ladder These are issues also about state capacities we got to talk about and if the state does not have those capacities then Where's the public delivery system to make sure that you rectify these problems that we are talking about That's why again the idea of focusing on politics and the state. I think it's crucial when talking about a form defection Thanks very much Just as a final point. I wanted to pick up on one of Simona's comments of the final comment So I guess in the broader project We we try to think about policies to address group-based inequalities of different types So they're in the collection that that you both are part of we look at Policies that are explicitly ethnically targeted. So the type of policies you're doing but then also policies that that don't explicitly target on an ethnic basis but have Impact on on ethnic inequality. So that's something we couldn't do at all in the affirmative action database Just it just wasn't feasible to look at sort of the dogs that don't bark You know, we couldn't look at those cases in that that way of gathering data But but it's something we do try to look at in the broader project So thank you very much and thanks for the comment Question