Introduction
This essay purports to explain the underlying and fundamental aspects with regards to inequality in South Africa and Latin America. It is said that inequality has decreased in Latin America, but not so much in South Africa even though both places have tried to close the inequality gap by intervening in the market through social grants and government interventions. An argument can be brought up about how Sweden, one of the most well off countries in the world has little to none inequality and this is reflected through many crucial aspects of having a free market. Sweden is said to be a neoliberalism economy or liberal economy as it tends to oppose government intervention in the free market when it inhibits free trade and open competition (Nolutshungu, 2009). This type of economic environment has seen with evidence to been very beneficially for countries such as Sweden, but why not so
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Governments also physically regulated them to impoverished parts of the countryside and cities (Sharma, 2012). During this time, the white minority benefited from discriminatory public policy. The inequality gap grew as many non-whites did not have the chance to accumulate capital in their own form of land, finance, skills, education or social network. According to Sharma (2012) high inequality increases if the creation of job opportunities is limited on a large enough scale and this was exactly the case in South Africa pre 1994, the rich and poor were kept apart, but they all still lived in the same country. Unemployment and therefore also income inequality have strong geographic dimensions, with insiders being largely urban and outsiders rural. The whole apartheid era left a heavy debt burden on South Africa follow it becoming a democracy in 1994 (Sharma, 2012).
In relation to Latin America in the 1990’s, Kelly (2008) argues that neoliberalism became dominant in Latin America. Just like South Africa, Latin America experienced a debt crisis in the early