3 Nobel Winners in Economics

NEW DELHI: Indian-American Abhijit Banerjee, along with Esther Duflo and Michael Kremer, won the 2019 economics Nobel for their work on finding new ways to tackle poverty. Duflo, a French-American, and Banerjee have been married for four years. They teach at Massachusetts Institute of Technology. They are the first couple to win the economics Nobel, and the sixth Nobel-winning couple. Kremer is at Harvard University.

The Nobel citation said the work of the three economists has “…improved efforts to … fight global poverty” by breaking down a complex problem into “smaller, more manageable questions”.

Congratulatory tweets to Banerjee from Prime Minister Narendra Modi and finance minister Nirmala Sitharaman, external affairs minister S Jaishankar as well as CMs Arvind Kejriwal and Mamata Banerjee, were among many such messages from India and globally.

Banerjee is second India born to get the economics Nobel — the formal award is called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Duflo is the second woman to receive the prize.

Abhijit Banerjee, along with Nobel laureate Paul Krugman, was part of a panel discussion at the ET Global Business Summit 2015

First Book Drew Global Attention
Amartya Sen, the winner of the economics Nobel in 1998, also congratulated Banerjee. Born in Calcutta (as Kolkata was called then) in 1961, Banerjee’s early education was in the city’s South Point School and his college was Presidency. After a master's in economics from Jawaharlal Nehru University, Banerjee got his Ph.D. from Harvard.

Banerjee and Duflo’s work on poverty first drew global attention with the publication of their 2011 book, Poor Economics. In that widely acclaimed volume, the two Nobel Laureates had written: “…we have to abandon the habit of reducing the poor to cartoon characters and take the time to really understand their lives, in all their complexity and richness.”

The authors’ insights included why poor families often invest in the education of only one of several children or why small farmers are often reluctant to use better farming methods. Their central thesis was that small changes, including tweaks in existing structures, often produced lasting and big outcomes in reducing poverty. That book also brought attention to the usefulness of a new field research method for economics: the randomized controlled trial — used in pharmaceutical drug testing.

In 2015, Banerjee, along with Nobel laureate Paul Krugman and former chief economic adviser Arvind Subramanian, was part of a panel discussion on the global and Indian economies under the aegis of the ET Global Business Summit. Banerjee has also been a contributor to ET’s Edit Page.

Banerjee has spoken on some of India’s current public policy debates. Speaking to CNBC-TV 18 after the announcement of the Nobel prize, Banerjee said India’s economy is “on shaky ground”, and that hope for growth revival is uncertain.

During the 2019 general election campaign, Congress said he was one of three economists the party had consulted while framing its universal basic income scheme — NYAY. Banerjee had told the media later that for NYAY to be funded, extra resources will have to be found. He was also one of the 108 academics who signed a letter that criticized government data analyses.

Banerjee and Duflo’s second book, Good Economics for Hard Times, is set for publication, and it draws on many current debates globally on public policy. ET carries an extract from the forthcoming book in today’s Edit Page. In the preamble of their new book, Banerjee and Duflo write that looking at the world, “inequality is exploding, environmental catastrophes and global policy disasters loom, but we are left with little more than platitudes to confront them with.”

The book’s first chapter, “Make Economics Great Again” — a play on Donald Trump’s election-winning slogan ‘Make America Great Again’ — the Nobel prize winners say: “We live in an age of growing polarization. From Hungary to India, from the Philippines to the United States, from the United Kingdom to Brazil … the public conversation between the left and the right has turned more and more into a high-decibel slanging match.”

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