alfred nobel, nobel prize

Nobel at Noon: Economic Sciences

December 1, 2019

The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2019 was awarded jointly to Abhijit Banerjee, Esther Duflo, and Michael Kremer “for their experimental approach to alleviating global poverty.”

Andrea Velasquez, PhD, assistant professor of economics at CU Denver, will lead a discussion about the trio’s designed measures to reduce global poverty for the December 12h Nobel at Noon Series.

The Nobel at Noon Series spotlights each Nobel Prize with an informal presentation and discussion. CU Denver faculty experts discuss the meaning and importance of the Nobel Prize while drawing the audience into a discussion about why this award matters to society as a whole.

The lecture begins at 12 p.m. on Thursday, December 12, in the Wartgow Welcome Center (Student Commons Building, Room 1300). Light refreshments will be provided. Feel free to bring your lunch.

Dissecting global poverty in the field

With more than 700 million people living in extreme poverty and 1 in 3 children malnourished, how we reduce global poverty is a fundamental and daunting question. The three Laureates who won this year’s prize sought answers by upending the field of development economics. By asking small, precise questions about poverty and then bringing them to the real world, the Laureates not only tested whether a certain intervention worked, but why.

Because of their work, field experiments have become a critical tool used by development economists to investigate the impact of policies designed to alleviate poverty. Their findings of causal effects would go on to change policy and improve the world’s ability to fight poverty through economic development, education, health, education and access to credit.

From the U.S. to Western Kenya

In the mid-1990s, Michael Kremer, PhD, department of economics at Harvard University, was the first to explore the learning crisis with field experiments. He began by breaking down the problem into smaller interventions: access to text books and other materials, hunger, absent teachers, and teaching methods. Kremer and his colleagues took a large number of schools in western Kenya that needed considerable support and randomly divided them into groups. In one study, researchers gave one group more textbooks, while another study examined free school meals.

The experiments showed that neither more textbooks nor free school meals made any difference to learning outcomes, but they saw progress when they provided extra support for students with special needs.

A direct effect on policy

In later field experiments, Abhijit Banerjee, PhD, and Esther Duflo, PhD, both in the department of economics at Massachusetts Institute of Technology (MIT), found the primary problem in many low-income countries is not a lack of resources. Instead, they discovered that teaching is not sufficiently adapted to the pupils’ needs. In the first of these experiments, the duo and their team studied remedial tutoring programs for pupils in two Indian cities. Schools in Mumbai and Vadodara received new teaching assistants who would support students with special needs.

“More individualised instruction and tutoring for the weakest students turned out to be the best way to boost student results,” according to the Nobel website. “One result of this is that India has invested in major student support programs that today include more than 100,000 schools.”

Many new field experiments in other countries followed these early studies in Kenya and India, focusing on important areas such as health, access to credit, and the adoption of new technology.