What does the 2019 Nobel mean for development economics?


Published 16.10.19

Why have Esther Duflo, Abhijit Banerjee and Michael Kremer been awarded the 2019 Nobel Prize in Economics? And what does this mean for development economics?

On Monday, the 2019 Nobel Prize (the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel) was awarded to Esther Duflo, Abhijit Banerjee and Michael Kremer for their work on bringing rigour to the field of development economics and poverty alleviation. 

Quoting from the Nobel Prize citation: “This year’s Prize in Economic Sciences rewards the experimental approach that has transformed development economics, a field that studies the causes of global poverty and how best to combat it. In just two decades, the pioneering work by this year’s Laureates has turned development economics ― the field that studies what causes global poverty and how best to combat it ― into a blossoming, largely experimental field.”

“Blossoming” is a complete understatement. Well over a decade ago, Esther and Abhijit started the Abdul Latif Jameel Poverty Action Lab (J-PAL), a network of researchers using these methods to understand what works and, equally importantly, what doesn’t work in the development policy toolkit. Today, J-PAL includes 181 affiliated professors and more than 400 research, policy, education, and training professionals across seven offices worldwide. J-PAL affiliates have led more than 800 randomised evaluations across the globe. Yes, 800! That’s 800 things we have learnt that we didn’t know before. In just over a decade, Esther, Abhijit and Michael have completely and utterly transformed the nature of what development economics is as a field. We now know more than we ever have in development. We also realise how much more there is left to learn.

Esther, Abhijit and Michael, from the day they began this agenda about 20 years ago, have inspired cohort after cohort of students to join them in their journey to learn as much as is humanly possible about how best to alleviate poverty. They have inspired other people’s students (like ourselves), their colleagues and collaborators (of which there are too many to name, but you know who you are) and they will no doubt continue to do so for decades to come.

It is truly amazing to see just how much the field of development economics has been completely revolutionised by these three incredible researchers. It is hard to think of anyone else who has had such a profound impact on the field. We want to highlight five of their contributions:

  • They have brought a standard of rigour, and hence respect, to the field of development economics. As a result, development economists have become among the leaders in the design and conduct of randomised controlled trials (RCTs) in economics.   
  • They have trained cohorts of students in the tools of rigour – cohorts who have then gone on to run their own RCTs or set up their own organisations like Innovations for Poverty Action (IPA), creating an expansive network of researchers across the world tackling important questions in the march to understand how to help alleviate global poverty.
  • They have unleashed a creativity and an innovation that can be seen throughout economics, in their own work as well as in the work of others inspired by them. 
  • They have helped bridge the gap between development research and policy. Less than 25 years ago, much of development research was not as empirical and it was often one step removed from local contexts and issues. J-PAL, as well as these three individuals themselves, work closely with policymakers and focus on real life problems and practical solutions. Their aim is to find context-specific answers, as well as to stitch together evidence from different contexts to help build a larger picture of how to alleviate global poverty. 
  • Their impact on the field beyond researchers has been equally profound. They have worked closely with so many different organisations and partners on the ground across the globe – NGOs, non-profits, governments, donors and universities – to help them all better understand the impacts they are having in their day to day lives of implementing programmes. This includes training programmes set up by J-PAL, the Micro Masters in Development at MIT (whose first on-campus cohort is now here) and much, much more. 

Notably, Esther is the second woman and the youngest person to have ever won this prize. In her interview right after winning, she said: "Showing that it is possible for a woman to succeed and be recognised for success I hope is going to inspire many, many other women to continue working and many other men to give them the respect that they deserve like every single human being". We hope these words and her actions will continue to inspire generations of development practitioners, particularly women and minorities, for years to come. 

Before we close, we have to say this prize is very personal to us, particularly Tavneet. A personal message from her: I work or have worked with each of these three researchers and the creativity, integrity, energy and pure dazzle they bring to their work inspires me every day. And I know I am one of many who feel this way. In celebrating their prize on Monday night, I said that they had had a profound effect on my life and it is the most deserved economics Nobel in years. Abhijit’s joking response was: “of course it is, because it changed your life”. This just highlights how they approach their lives: with humility, grace and humour, every step of the way. I am proud to be inspired by them!

Let us leave you with some VoxDev articles the trio have written for us over the past two years, with no doubt many more to come!