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

Non-fiction

Non-fiction is the form of any narrative, account, or other communicative work whose assertions and descriptions are understood to be fact...

 book by Abhijit V. Banerjee

Abhijit Banerjee

Abhijit Vinayak Banerjee is an Indian economist. He is currently the Ford Foundation International Professor of Economics at the Massachusetts Institute of Technology...

 and Esther Duflo

Esther Duflo

Esther Duflo is a French economist, currently the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics at the Massachusetts Institute of Technology. She is also co-founder and the Director of the Abdul Latif Jameel Poverty Action Lab...

, both professors of Economics

Economics

Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...

 at MIT. The book reports on the effectiveness of solutions to global poverty

Poverty

Poverty is the lack of a certain amount of material possessions or money. Absolute poverty or destitution is inability to afford basic human needs, which commonly includes clean and fresh water, nutrition, health care, education, clothing and shelter. About 1.7 billion people are estimated to live...

 using a evidence-based randomized control trial approach. It won the 2011 Financial Times and Goldman Sachs Business Book of the Year Award

Financial Times and Goldman Sachs Business Book of the Year Award

Financial Times and Goldman Sachs Business Book of the Year Award is an annual award given to the best business book of the year as determined by the Financial Times and Goldman Sachs. It aims to find the book that has ‘the most compelling and enjoyable insight into modern business issues.’ The...

.

Overview

For more than fifteen years Abhijit V. Banerjee and Esther Duflo have worked with the poor in dozens of countries spanning five continents, trying to understand the specific problems that come with poverty and to find proven solutions. They looked at questions such as: Why would a man in Morocco who doesn’t have enough to eat buy a television? Why is it so hard for children in poor areas to learn even when they attend school? Why do the poorest people in the Indian state of Maharashtra spend 7 percent of their food budget on sugar? Does having lots of children actually make you poorer?

Per the title, the book is a 'radical rethinking' of the economics of poverty, but it also offers practical solutions. Through a careful analysis of a body of evidence, including hundreds of randomized control trials Banerjee and Duflo’s lab pioneered, they show why the poor, despite having the same desires and abilities as anyone else, end up with entirely different lives. Banerjee and Duflo used randomized control trials across five continents to test the impact of policies aimed at beating poverty.

Through their work, Banerjee and Duflo look at some of the most surprising facets of poverty: why the poor need to borrow in order to save, why they miss out on free life-saving immunizations but pay for drugs that they do not need, why they start many businesses but do not grow any of them, and many other puzzling facts about living with less than 99 cents per day.

Poor Economics argues that so much of anti-poverty policy has failed over the years because of an inadequate understanding of poverty. The battle against poverty can be won, but it will take patience, careful thinking and a willingness to learn using an evidence-based approach based on randomized control trials.

Website

A website was created to supplement the book. The website has a page for each chapter where an introduction is given to the chapter. A map showing all the studies used in the chapter and these studies are linked to their original sources. There is a column which provide links to webpages of all the researchers mentioned in the chapter. The page also has all the data and figures mentioned in the chapter in the book and it also provide interactive tools to play with the data. The unique feature of page is "What Can You Do" Column, this column gives the link of major organizations working in the field or for the problem discussed in the chapter. The website provides material to help someone understand the concepts discussed in the book.

About the Authors

Abhijit V. Banerjee

Abhijit Banerjee

Abhijit Vinayak Banerjee is an Indian economist. He is currently the Ford Foundation International Professor of Economics at the Massachusetts Institute of Technology...

 is the Ford Foundation

Ford Foundation

The Ford Foundation is a private foundation incorporated in Michigan and based in New York City created to fund programs that were chartered in 1936 by Edsel Ford and Henry Ford....

 International Professor

Professor

A professor is a scholarly teacher; the precise meaning of the term varies by country. Literally, professor derives from Latin as a "person who professes" being usually an expert in arts or sciences; a teacher of high rank...

 of Economics

Economics

Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...

 at MIT and a founder of the Abdul Latif Jameel Poverty Action Lab

Abdul Latif Jameel Poverty Action Lab

The Abdul Latif Jameel Poverty Action Lab is an academic center located at the Massachusetts Institute of Technology Department of Economics which is dedicated to evaluating the impact of anti-poverty programs through randomized controlled trials similar to those used in medical research...

 (J-PAL). He is a fellow of the American Academy of Arts and Sciences

American Academy of Arts and Sciences

The American Academy of Arts and Sciences is an independent policy research center that conducts multidisciplinary studies of complex and emerging problems. The Academy’s elected members are leaders in the academic disciplines, the arts, business, and public affairs.James Bowdoin, John Adams, and...

 and the Econometric Society

Econometric Society

The Econometric Society is an international society for the advancement of economic theory in its relation with statistics and mathematics. It was founded on December 29, 1930 at the Stalton Hotel in Cleveland, Ohio....

 and has been a Guggenheim Fellow. He has also received the inaugural Infosys Prize

Infosys Prize

The Infosys Prize is an annual award that recognizes outstanding contributions by scientists, researchers, engineers and social scientists in India. By recognizing and rewarding extraordinary accomplishments, the Infosys Prize aims to elevate the prestige of pure and applied sciences research in...

 2009 in Social Sciences

Social sciences

Social science is the field of study concerned with society. "Social science" is commonly used as an umbrella term to refer to a plurality of fields outside of the natural sciences usually exclusive of the administrative or managerial sciences...

 and Economics

Economics

Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...

.

Esther Duflo

Esther Duflo

Esther Duflo is a French economist, currently the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics at the Massachusetts Institute of Technology. She is also co-founder and the Director of the Abdul Latif Jameel Poverty Action Lab...

 is the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics

Development economics

Development Economics is a branch of economics which deals with economic aspects of the development process in low-income countries. Its focus is not only on methods of promoting economic growth and structural change but also on improving the potential for the mass of the population, for example,...

 at MIT and a founder and director of the Abdul Latif Jameel Poverty Action Lab

Abdul Latif Jameel Poverty Action Lab

The Abdul Latif Jameel Poverty Action Lab is an academic center located at the Massachusetts Institute of Technology Department of Economics which is dedicated to evaluating the impact of anti-poverty programs through randomized controlled trials similar to those used in medical research...

 (J-PAL). Duflo has received numerous academic honors and prizes, including most recently the John Bates Clark Medal

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"...

 (2010) and a MacArthur Fellowship

MacArthur Fellows Program

The MacArthur Fellows Program or MacArthur Fellowship is an award given by the John D. and Catherine T...

 (2009). She has also been featured in Foreign Policy

Foreign Policy

Foreign Policy is a bimonthly American magazine founded in 1970 by Samuel P. Huntington and Warren Demian Manshel.Originally, the magazine was a quarterly...

's Top 100 Global Thinker and Fortune 40 under 40

40 under 40 (Fortune Magazine)

Fortune Magazine's 40 under 40 List details the young stars in business across the globe.Mark Zuckerberg topped the 2011 list. Facebook now has over 800 million users.-External links:***...

.

Reception

The book has been well received. Robert Solow

Robert Solow

Robert Merton Solow is an American economist particularly known for his work on the theory of economic growth that culminated in the exogenous growth model named after him...

 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.”

The Guardian

The Guardian

The Guardian, formerly known as The Manchester Guardian , is a British national daily newspaper in the Berliner format...

wrote:

“[Banerjee and Duflo] offer 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.”

The New York Times

The New York Times

The New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...

wrote:

“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?”

The Wall Street Journal

The Wall Street Journal

The Wall Street Journal is an American English-language international daily newspaper. It is published in New York City by Dow Jones & Company, a division of News Corporation, along with the Asian and European editions of the Journal....

wrote:

“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.”

Editions

• Poor Economics: Rethinking Poverty And The Ways To End It, Random House India (25 May 2011). ISBN 978-8184001815 - India edition hardcover.
• Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, PublicAffairs (April 26, 2011). ISBN 978-1586487980 - Foreign edition hardcover.
• Electronic and paperback editions.