Let's stop insinuating that just because people are poor, they are stupid. That's nonsense.

A recent BBC piece reports on sex workers in Kenya using post-exposure prophylaxis (PEP)* as a substitute for condoms, cycling through different clinics to use the drugs on a regular basis. This lets them earn a premium for unprotected sex at relatively low risk to themselves (although not without social and personal cost). The article focuses mainly on the public health ramifications, which are definitely serious. A skeptical reader might point out that the only first-person anecdote about the alleged practice is in fact a totally reasonable use of PEP: a sex worker got drunk, she made a mistake, she got worried about HIV infection, so she got her hands on some ARVs. That’s exactly what you’re supposed to do.

I want to put that aside, however, and focus on how goddamned clever the women described in this piece are. These drugs will keep me from getting HIV? Then I can use them instead of condoms – that way I can earn more money, since men will pay more for unprotected sex. You can’t get them from the same clinic more than once a year? That’s okay, I’ll give a fake name. Take pictures of the people you give PEP to? I start going to different clinics. Or I send a friend.

This isn’t an isolated case, either. Several years ago, TB-positive people in South Africa evidently started selling their saliva to other folks looking to get targeted disability grants. I remember hearing about a similar scheme involving the selling of HIV-positive blood. No matter how well you design your system, you should always expect people to find a way to game it.

Economics is often criticized for the assumption that people are rational. Obviously, the critics say, human beings are not perfect calculating machines, they make mistakes, they do things that don’t maximize profits, or whatever. The typical counterargument defends rationality by pointing out that it can accommodate mistakes, that we don’t actually think people maximize profits, and so forth – it confronts the “people aren’t rational” argument on its own terms.

I want to offer a different defense: rationality, the way it is typically used by economists, means that people are smarter than you think – even poor people. Indeed, the canonical economic model of a poor person is a rich person with less money.**  The rational choice paradigm of economics amounts to taking people’s choices seriously as legitimate choices given the options they face, and trying to understand them as such, rather than writing them off as obviously unreasonable.

*PEP is the use of a large dose anti-retroviral drugs shortly after a (potential) HIV exposure to prevent infection with the virus.
**Even most behavioral economics research that looks at poverty and poverty traps focuses on how resource constraints lead to impatience, time inconsistency, and other issues with decisionmaking. The poor make questionable decisions because they don’t have much money, not vice-versa.

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