Friday, April 7, 2006

Cliffs

In South Africa, Poor AIDS Patients Adopt Risky Ploy [WSJ]:
"Her decision represents an unexpected twist in South Africa's AIDS crisis. The South African government gives Zolile antiretroviral "cocktails" to make her healthier. It will also give her a $130-a-month disability grant -- but only if she gets sicker than she is now. And if she takes the drugs, she probably won't get sick enough to qualify for the cash."

Does social assistance creates a cliff for people to get to the next level? It becomes like a step function. Let's say you get $30 if you do nothing.

Well to work a lot and get only $31 isn't worth it if you get $30 for doing nothing right? You're only getting aincremental $1 for your efforts, so why bother? Only when you get magnitudes above the social assistance level is it really worth trying harder..

I don't know what the solution to that is..