A perennial issue faced by academia of any kind, and economics in general, is an alleged lack of pragmatism. Laymen generally tend to be dismissive of theories, with the most common complaint being that the suggested solutions, and for that matter, the propositions themselves, are detached from ground reality. Honestly, that’s a fair attack point. The number of retrospectively flawed theories massively outweigh the successful ones. This is where this book, and the methodology adopted by J-PAL(an organisation founded by the authors of this book) exceeds expectations.
Abhijeet Banerjee and Esther Duflo require no introduction. Their seminal approach to developmental economics won them the Nobel Prize for Economics last year, and this book is an amazing place to start what they propose. To put it concisely, they advocate a common sense driven and solution based approach to poverty alleviation and developmental economics in general. They choose to deliberately look beyond the myopia of high academia and embrace economics from an all-encompassing perspective. If I may attempt to be witty, they liberally use an interplay of liberal arts ranging from understanding the psychology of the poor (famous now through Richard Thaler’s idea of Behavioural Economics) to understanding the social structures of specific communities. But that’s not what I want to talk about.
For me, the book was a brilliant example of how and why a holistic approach towards policy making has the potential to maximise social impact, and how seemingly puzzling dilemmas are rooted in simple notions and basic understanding of the human mind. Poor Economics is an outlier for anyone who wishes to develop a more hands-on approach towards making the world a better place and/or wishes to understand a modern approach to developmental economics in a succinct manner.
Cross-posted at The Standing Coin