Saturday, May 12, 2012

Canadian experience in providing a minimum income to the poor


Dear Mr Tan,


Just saw in your blog that you are observing the new Malaysian minimum wage, especially in relation to the corresponding debate in Sg. 


A friend shared with me something interesting from Canada. 
http://www.dominionpaper.ca/articles/4100#


In the 70s they did an experiment to see what happens if they give a guaranteed income to people. This is different from minimum wage, in this scheme everyone gets an additional amount of money directly that will bring them above the poverty line, if they are below the line, regardless of whether they are working.


Some of the main results are:
1) People continued working, except for new mothers and teenagers. However, new mothers not working brings about the positive effect of more time with children. And teenagers not working brings about the positive effect of higher graduation rates. 
2) Hospitalization decreased significantly. 


Wikipedia article:
http://en.wikipedia.org/wiki/Mincome

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