Michael Kremer, Esther Duflo, and Abhijit Banerjee, winners of the 2018 Nobel Prize in Economics (Policy Brief)
The 2019 Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel was awarded today to Abhijit Banerjee and Esther Duflo, professors at the Massachusetts Institute of Technology (MIT), and Michael Kremer, professor at Harvard University, for their work on reducing global poverty.
Esther Duflo is a French economist, unlike the other two American laureates.
The Royal Swedish Academy stated that « their work has significantly improved our ability to reduce poverty worldwide. In 20 years, their new experimental approach has transformed development economics. »
The three researchers have developed an effective experimental field method to ensure reliability and rigor in public policy evaluations, particularly in development economics.
Michael Kremer, Esther Duflo, and Abhijit Banerjee noted that differences in productivity cannot be explained solely by rich and poor countries, but also exist within the same country. Their experimental approach, which is similar to that used in the pharmaceutical industry, consists first of all of establishing smaller panels with identical average characteristics and distributing them randomly.
For example, different schools in Kenya facing difficulties were randomly divided into different groups and received different types of resources (books, meals, etc.). The results can then be observed in practice in the field. They show that free books or meals do not significantly increase children’s learning abilities, unlike teaching methods adapted to their specific needs, particularly those with the greatest academic difficulties.
In the medical field, their work has highlighted the sensitivity of populations in developing countries to the price of vaccines and, above all, the success of vaccination programs when mobile clinics and incentive mechanisms, such as the distribution of bags of lentils, are in place.
The work of Michael Kremer, Esther Duflo, and Abhijit Banerjee has inspired a great deal of research in development economics and has had a massive concrete impact. In fact, the Royal Swedish Academy estimates that 5 million Indian children have benefited from school programs, not to mention the introduction of health prevention campaigns, both of which stem from their work.
Esther Duflo is the second woman to receive the Nobel Prize in Economics and the third French woman to receive this award.
Sources: Le Monde, Press release from the Royal Swedish Academy
