an integrated survey, demographic and economy-wide analysis

Background: This paper estimates the economic impact of HIV/AIDS on the KwaZulu-Natal province and the rest of South Africa. Methods: We extended previous studies by employing: an integrated analytical framework that combined firm surveys of workers ' HIV prevalence by sector and occupation; a demographic model that produced both population and workforce projections; and a regionalized economy-wide model linked to a survey-based micro-simulation module. This framework permits a full macro-microeconomic assessment. Results: Results indicate that HIV/AIDS greatly reduces annual economic growth, mainly by lowering the long-run rate of technical change. However, impacts on income poverty are small, and inequality is reduced by HIV/AIDS. This is because high unemployment among low-income households minimises the economic costs of increased mortality. By contrast, slower economic growth hurts higher income households despite lower HIV prevalence. Conclusion: We conclude that the increase in economic growth that results from addressing HIV/ AIDS is sufficient to offset the population pressure placed on income poverty. Moreover, incentive