''Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty'' (2011) is a

non-fiction Non-fiction (or nonfiction) is any document or content (media), media content that attempts, in good faith, to convey information only about the real life, real world, rather than being grounded in imagination. Non-fiction typically aims to pre ...

book by Abhijit V. Banerjee and

Esther Duflo Esther Duflo, FBA (; born 25 October 1972) is a French-American economist currently serving as the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics at the Massachusetts Institute of Technology (MIT). In 2019, she w ...

, both professors of

Economics Economics () is a behavioral science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interac ...

Massachusetts Institute of Technology The Massachusetts Institute of Technology (MIT) is a Private university, private research university in Cambridge, Massachusetts, United States. Established in 1861, MIT has played a significant role in the development of many areas of moder ...

(MIT) and

Nobel Memorial Prize in Economic Sciences The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (), commonly referred to as the Nobel Prize in Economics(), is an award in the field of economic sciences adminis ...

laureates. The book reports on the effectiveness of solutions to global

poverty Poverty is a state or condition in which an individual lacks the financial resources and essentials for a basic standard of living. Poverty can have diverse Biophysical environmen ...

using an

evidence-based Evidence-based practice is the idea that occupational practices ought to be based on scientific evidence. The movement towards evidence-based practices attempts to encourage and, in some instances, require professionals and other decision-makers ...

randomized control trial approach. It won the 2011 Financial Times and Goldman Sachs Business Book of the Year Award.Andrew Hill
"‘Poor Economics’ takes business book prize"
''Financial Times'', 3 Nov 2011.

Overview

''Poor Economics'' lays out a middle ground between purely market-based solutions to global poverty, versus "grand development plans." It rejects broad generalizations and formulaic thinking. Instead, the authors help to understand how the poor really think and make decisions on such matters as education, healthcare, savings, entrepreneurship, and a variety of other issues. They advocate the use of observation, using rigorous randomized controlled testing on five continents, and most importantly by actually listening to what the poor have to say. Often the answers are startling and counter-intuitive, but make the utmost sense when circumstances are understood. In addition, the universal traps of Ignorance, Ideology, and Inertia often stymie policies and institutions, but may be avoided. From this empirical approach, the authors believe that the best strategies for eradicating poverty can emerge. However, they resist laying out a broad set of conclusions. Instead they draw some simple yet powerful lessons, and believe that small changes can have big effects. The authors conclude on the optimistic note that we are all part of the solution.

Authors

Abhijit V. Banerjee is the

Ford Foundation The Ford Foundation is an American private foundation with the stated goal of advancing human welfare. Created in 1936 by Edsel Ford and his father Henry Ford, it was originally funded by a $25,000 (about $550,000 in 2023) gift from Edsel Ford. ...

International

Professor Professor (commonly abbreviated as Prof.) is an Academy, academic rank at university, universities and other tertiary education, post-secondary education and research institutions in most countries. Literally, ''professor'' derives from Latin ...

MIT The Massachusetts Institute of Technology (MIT) is a private research university in Cambridge, Massachusetts, United States. Established in 1861, MIT has played a significant role in the development of many areas of modern technology and sc ...

and a founder of the Abdul Latif Jameel Poverty Action Lab (J-PAL). He is a fellow of the

American Academy of Arts and Sciences The American Academy of Arts and Sciences (The Academy) is one of the oldest learned societies in the United States. It was founded in 1780 during the American Revolution by John Adams, John Hancock, James Bowdoin, Andrew Oliver, and other ...

and the

Econometric Society The Econometric Society is an international society of academic economists interested in applying statistical tools in the practice of econometrics. It is an independent organization with no connections to societies of professional mathematicians o ...

and has been a

Guggenheim Fellow Guggenheim Fellowships are grants that have been awarded annually since by the John Simon Guggenheim Memorial Foundation, endowed by the late Simon and Olga Hirsh Guggenheim. These awards are bestowed upon individuals who have demonstrated d ...

. He has also received the inaugural Infosys Prize 2009 in

Social Sciences Social science (often rendered in the plural as the social sciences) is one of the branches of science, devoted to the study of society, societies and the Social relation, relationships among members within those societies. The term was former ...

and

. He has been featured in

Foreign Policy Foreign policy, also known as external policy, is the set of strategies and actions a State (polity), state employs in its interactions with other states, unions, and international entities. It encompasses a wide range of objectives, includ ...

's Top 100 Global Thinkers in 2011. In 2019, he shared the

with

and Michael Kremer.

is the Abdul Latif Jameel Professor of

Poverty Alleviation Poverty reduction, poverty relief, or poverty alleviation is a set of measures, both economic and humanitarian, that are intended to permanently lift people out of poverty. Measures, like those promoted by Henry George in his economics classi ...

and

Development Economics Development economics is a branch of economics that deals with economic aspects of the development process in low- and middle- income countries. Its focus is not only on methods of promoting economic development, economic growth and structural c ...

at MIT and a founder and director of the Abdul Latif Jameel Poverty Action Lab (J-PAL). Duflo has received numerous academic honors and prizes, including the

(2019), the

John Bates Clark Medal The John Bates Clark Medal is awarded by the American Economic Association to "that American economist under the age of forty who is adjudged to have made a significant contribution to economic thought and knowledge." The award is named after the ...

(2010), and a

MacArthur Fellowship The MacArthur Fellows Program, also known as the MacArthur Fellowship and colloquially called the "Genius Grant", is a prize awarded annually by the MacArthur Foundation, John D. and Catherine T. MacArthur Foundation to typically between 20 and ...

(2009). She has also been featured in ''

s Top 100 Global Thinkers and Fortune 40 under 40. The two authors married each other in 2015.

Reception

The book has been well received.

Robert Solow Robert Merton Solow, GCIH (; August 23, 1924 – December 21, 2023) was an American economist who received the 1987 Nobel Memorial Prize in Economic Sciences, and whose work on the theory of economic growth culminated in the exogenous growth ...

commented: :"Abhijit Banerjee and Esther Duflo are allergic to grand generalizations about the secret of economic development. Instead they appeal to many local observations and experiments to explore how poor people in poor countries actually cope with their poverty: what they know, what they seem (or don't seem) to want, what they expect of themselves and others, and how they make the choices that they can make. Apparently there are plenty of small but meaningful victories to be won, some through private and some through public action, that together could add up to a large gains for the world's poor, and might even start a ball rolling. I was fascinated and convinced."

Madeleine Bunting Madeleine Clare J. Bunting (born March 1964) is an English writer. She was formerly an associate editor and columnist at ''The Guardian'' newspaper. She has written five works of non-fiction and two novels (''Ceremony of Innocence'' will be publi ...

reviewed the book for ''

The Guardian ''The Guardian'' is a British daily newspaper. It was founded in Manchester in 1821 as ''The Manchester Guardian'' and changed its name in 1959, followed by a move to London. Along with its sister paper, ''The Guardian Weekly'', ''The Guardi ...

'', writing: :" anerjee and Duflooffer a refreshingly original take on development, and they are very aware of how they are bringing an entirely new perspective into a subject dominated by big polemics from the likes of Jeffrey Sachs and William Easterly... they are clearly very clever economists and are doing a grand job to enrich their discipline's grasp of complex issues of poverty – so often misunderstood by people who have never been poor." Nicholas Kristof reviewed the book for ''

The New York Times ''The New York Times'' (''NYT'') is an American daily newspaper based in New York City. ''The New York Times'' covers domestic, national, and international news, and publishes opinion pieces, investigative reports, and reviews. As one of ...

'', writing: :"Randomized trials are the hottest thing in the fight against poverty, and two excellent new books have just come out by leaders in the field. One is ''Poor Economics'', by Abhijit Banerjee and Esther Duflo... These terrific books move the debate to the crucial question: What kind of aid works best?" Development economist William Easterly reviewed the book for the ''

Wall Street Journal ''The Wall Street Journal'' (''WSJ''), also referred to simply as the ''Journal,'' is an American newspaper based in New York City. The newspaper provides extensive coverage of news, especially business and finance. It operates on a subscriptio ...

'', writing: :"Marvelous, rewarding...''More Than Good Intentions'' and ''Poor Economics'' are marked by their deep appreciation of the precariousness that colors the lives of poor people as they tiptoe along the margin of survival. But I would give an edge to Mr. Banerjee and Ms. Duflo in this area—the sheer detail and warm sympathy on display reflects a true appreciation of the challenges their subjects face... They have fought to establish a beachhead of honesty and rigor about evidence, evaluation and complexity in an aid world that would prefer to stick to glossy brochures and celebrity photo-ops. For this they deserve to be congratulated—and to be read." James Tooley reviewed the parts of the book about education for ''

Econ Journal Watch ''Econ Journal Watch'' is a semiannual peer-reviewed electronic journal established in 2004. It is published by the Fraser Institute. According its website, the journal publishes comments on articles appearing in other economics journals, essays, r ...

''. Although he was critical of the authors' conclusions in those chapters, he generally praised their overall approach: :''Poor Economics'' "is contextualised with stories of the realities of lives of the poor, with evidence adduced to support or dismiss particular policy proposals. All of the chapters are interesting and challenging...I favour much of their general approach. Experts, I agree, should have to "step out of the office" and get their boots muddy. I'm also in favour of "relying on evidence", and of being judicious, even cautious, with big ideas." Sanjay G. Reddy in his 2012 article "Randomise this! On poor economics" in the journal '' Review of Agrarian Studies'' was more critical of the authors approach than many others. He concludes by arguing as follows: He also includes a footnote with the attempt at humour ''One can think of at least three interpretations of the title, not all favourable to the authors.''.Reddy, S. G. (2012). Randomise this! On poor economics. Review of Agrarian Studies, 2(2) ''Poor Economics'' won the 2011 Financial Times and Goldman Sachs Business Book of the Year Award.

Editions

* ''Poor Economics: Rethinking Poverty And The Ways To End It'', Random House India (25 May 2011). – India edition hardcover. * ''Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty'', PublicAffairs (April 26, 2011). – Foreign edition hardcover. * Electronic and paperback editions.

References

{{Reflist, refs= {{cite web, title=Abhijit Banerjee, url=http://www.povertyactionlab.org/banerjee, publisher=The Abdul Latif Jameel Poverty Action Lab, accessdate=18 April 2012 {{cite web, title=Academy Members (1780-present), Chapter B, url=http://www.amacad.org/publications/BookofMembers/ChapterB.pdf, publisher=American Academy of Arts and Sciences, accessdate=18 April 2012, page=6 {{cite web, title=Fellows of the Econometric Society, url=http://www.econometricsociety.org/fellows.asp, publisher=The Econometric Society, accessdate=18 April 2012, url-status=dead, archiveurl=https://web.archive.org/web/20081210000000/http://www.econometricsociety.org/fellows.asp, archivedate=10 December 2008 {{cite web, title=All Fellows, url=http://www.gf.org/fellows/all?index=b&page=3, publisher=The John Simon Guggenheim Memorial Foundation, accessdate=18 April 2012 {{cite web, title=Laureates – Infosys Prize 2009, url=http://www.infosys-science-foundation.com/prize/laureates/2009/index.asp, publisher=Infosys Science Foundation, accessdate=18 April 2012 {{cite web, title=The FP Top Global Thinkers, url=https://foreignpolicy.com/articles/2011/11/28/the_fp_top_100_global_thinkers?page=full, work=Foreign Policy, accessdate=18 April 2012, date=December 2011, quote=Foreign Policy presents a unique portrait of 2011's global marketplace of ideas and the thinkers who make them. {{cite web, title=Esther Duflo, url=http://www.povertyactionlab.org/duflo, publisher=The Abdul Latif Jameel Poverty Action Lab, accessdate=18 April 2012 {{cite web, title=John Bates Clark Medal, url=http://www.aeaweb.org/honors_awards/clark_medal.php, publisher=American Economic Association, accessdate=18 April 2012 {{cite web, title=Meet the 2009 MacArthur Fellows, url=http://www.macfound.org/fellows/class/2009/, publisher=MacArthur Foundation, accessdate=18 April 2012 {{cite web, title=The FP Top 100 Global Thinkers, url=https://foreignpolicy.com/articles/2010/11/29/the_fp_top_100_global_thinkers?page=0,32, work=Foreign Policy, accessdate=18 April 2012, date=December 2010, quote=Foreign Policy presents a unique portrait of 2010's global marketplace of ideas and the thinkers who make them., url-status=dead, archiveurl=https://web.archive.org/web/20120210003643/http://www.foreignpolicy.com/articles/2010/11/29/the_fp_top_100_global_thinkers?page=0,32, archivedate=10 February 2012 {{cite web, title=40 under 40, url=https://money.cnn.com/galleries/2010/fortune/1010/gallery.40_under_40.fortune/19.html, website=CNN Money, accessdate=18 April 2012, page=19 {{cite web, url=https://www.nobelprize.org/uploads/2019/10/press-economicsciences2019.pdf, title=The Prize in Economic Sciences 2019, publisher=Royal Swedish Academy of Sciences: Nobel prize, date=14 October 2019, accessdate=14 October 2019 , language=

External links

Poor Economics
official website 2011 non-fiction books Books about poverty Collaborative non-fiction books PublicAffairs books