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The 2019 Nobel Prize in Economics goes to three scientists who injected the rigor of randomized controlled trials into experiments to reduce poverty and boost education and public health. The $900,000 award is split between Michael Kremer, of Harvard University, and Abhijit Banerjee and Esteher Duflo, both of the Massachusetts Institute of Technology in Cambridge. According to a press release from the Nobel prize committee, their findings have “dramatically improved our ability to fight poverty in practice.”
About 10% of the world’s 7 billion people live in extreme poverty on less than $2 a day, according to the World Bank. While the number of people living in such conditions has declined over the past several decades, there is much confusion about the best or most efficient way to make progress. The Nobel laureates, leaders of a group of development experts sometimes called “randomistas,” brought a spirit of experimentation to the often muddled world of international development.
In the 1990s, Kremer and his colleagues used field experiments in western Kenya to test ways to improve school results. They distributed extra textbooks and free school meals to different needy schools, and found that neither intervention made any difference to learning outcomes. Later, performing similar randomized interventions in schools in India, Banerjee and Duflo and their colleagues found that remedial tutoring led to far more effective outcomes.
The researchers have tried to address questions about possible limitations to their work, such as whether their conclusions could be applied globally, across nations, outside of specific cultural contexts, or whether results for small groups of people could be scaled up. In a 2015 paper in Science, Banerjee and Duflo and their colleagues tried a set of interventions for more than 10,000 poor participants in Ethiopia, Ghana, Honduras, India, Pakistan and Peru. More than half were given cash, food, skills training, and other support. One year after the conclusion of the interventions, the “treated” group was found to show gains on most of a variety of measured outcomes, such as food security and income.
Duflo is the second woman ever to win the economics prize.
This is a developing story.