Poverty Fighters: Abhijit Banerjee and Esther Duflo - IMF F&D
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- Authors: ANDREAS ADRIANO
- Published: June 1, 2020
J-PAL, mission, and impact
- J-PAL (Abdul Latif Jameel Poverty Action Lab) applies randomized controlled trials to development economics; founded in 2003 and renamed in 2005.
- Organizational scale and outputs:
- More than 1,000 randomized controlled trials in more than 80 countries.
- Programs verified by J-PAL have been scaled up to reach more than 400 million people.
- J-PAL’s staff includes about 400 research, policy, education, and training professionals.
- An additional 200 researchers oversee projects executed by about 1,000 contractors.
- The organization has awarded $63 million in grants to fund new research since its founding in 2003.
- Nobel recognition:
- The 2019 Nobel Prize in economics was awarded to Abhijit Banerjee, Esther Duflo, and Michael Kremer for their work; the Nobel Committee said their experimental research methods “transformed development economics” and now “entirely dominate development economics.”
Methodology: randomized controlled trials (RCTs) and “divide to conquer”
- Core approach:
- Break big problems into smaller, testable questions and use randomized assignment to create comparable treatment and control groups.
- Multiple arms can compare different solutions.
- Rationale and origins:
- RCTs are the long-standing gold standard in medicine and were applied earlier in agriculture and political science; first economics RCTs date from the 1960s.
- Framing by J-PAL leaders:
- Esther Duflo: RCTs take “a big problem and breaking it into manageable pieces, smaller questions that admit rigorous answers.”
- Abhijit Banerjee and Duflo (quote from Poor Economics): “The poor are no less rational than anyone else—quite the contrary.”
Notable field findings and program examples
- Clean cookstoves (Global Alliance for Clean Cookstoves initiative):
- Initiative: $400 million project launched in 2010 to replace open-fire cooking used by 3 billion people.
- Problem observed: Millions of stoves built in India were largely abandoned after four years.
- J-PAL field study: Followed about 2,500 households in 44 villages in Odisha and identified practical barriers—stoves needed more attention, broke down and weren’t repaired, took longer to cook, and couldn’t be moved outdoors because of chimneys.
- Lesson: “The fact that we think something should work is not enough—it needs to work for the people who use them.” (Abhijit Banerjee)
- Indonesia’s Rice for the Poor (Raskin):
- Program scale and design: $1.5 billion-a-year system aimed to distribute 15 kg of rice a month to the poorest households at a fifth of the market price.
- Implementation failures: Eligible households often received a third of what they were entitled to at a cost 40 percent higher than it should have been due to local tinkering by community leaders.
- J-PAL intervention: Randomized tests of information-bearing “social protection cards” raised awareness of qualification criteria, monthly allotments, and prices.
- Outcome and scale-up: Within a year the government issued about 15 million cards and bundled two other cash-transfer programs, adding up to more than $4 billion.
- Environmental enforcement in Gujarat:
- RCT changed auditor assignment rules; enforcement improved when inspectors were not paid by those they audited.
- Other topics studied with RCTs:
- Bed net distribution strategies for malaria prevention.
- Buyback programs for unused opioid pills in the United States.
- Ensuring Indonesian households receive rice they are entitled to under federal programs.
- Energy-efficiency measures in Mexico, Wisconsin, and Michigan showing low uptake and rebound effects.
- Small-farm consulting and loans in India increased production and income but did not reduce energy use.
Organizational reach and diversification
- Regional centers in North America, Latin America and the Caribbean, Europe, Africa, the Middle East, South Asia, and Southeast Asia.
- Research agenda expanded beyond poor and emerging market economies to include:
- Europe: social inclusion of immigrants.
- North America: retraining and skills development, homelessness and housing, criminal justice reform, and health.
Critiques, limits, and the micro–macro challenge
- Limits of RCTs:
- “Transportation” problem: Results from one context may not generalize to another; a Kenya malaria study might be irrelevant for Brazil.
- Small answers may not add up to solve big macro problems.
- Academic critique:
- Angus Deaton’s reservations: RCTs refuse the structural frameworks that are necessary to interpret and apply findings across contexts, arguing that applying results elsewhere requires “previous knowledge and understanding.”
- J-PAL response and bridging efforts:
- Executive Director Iqbal Dhaliwal (hired in 2009) focuses on making evidence accessible to policymakers, validating findings in different contexts, and monitoring implementation to return reality checks into policy.
Policy implications and recommendations
- From J-PAL leadership and practice:
- Base policy decisions on evidence tested in the field rather than “instinct, ideology, or inertia” (Iqbal Dhaliwal).
- Break large problems into manageable, testable pieces to obtain rigorous answers.
- Use RCTs to generate concrete, actionable results that can inform policy and implementation.
- Validate and adapt findings across contexts before scaling.
- Monitor implementation and feed operational experience back to research.
- Public management and government capacity:
- The COVID-19 pandemic highlighted the importance of timely statistics and government administrative data for decision-making; administrative data can “share results faster and cheaper than [with] field work” (Iqbal Dhaliwal).
- Invest in building governments’ capacity to make good decisions and to be resilient to handle big events, exemplified by the ability to make quick emergency cash transfers.
- The pandemic suggests a reassessment of the role and value of governments in crisis response and social protection.
- Research expansion priorities:
- Duflo hopes Nobel recognition will help expand J-PAL’s work into areas like climate change and better use of government data.
Responses to COVID-19 and forward-looking priorities
- Operational adjustments as of mid-March:
- Pulled staff from the field and increased phone surveys.
- Offered financing to quickly launch new research initiatives such as cash transfers, digital identification, and innovation in government practices.
- Pandemic as a prompt for policy:
- The crisis underscores the need for accurate, timely statistics and stronger government capacity.
- Dhaliwal: the pandemic foreshadows what a climate crisis could look like; “the time to act is now.”
Source: Poverty Fighters: Abhijit Banerjee and Esther Duflo — F&D Magazine (June 2020).
Content in this bundle
- شخصيات اقتصادية
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- Poverty Fighters: Abhijit Banerjee and Esther Duflo – IMF F&D
- 贫困斗士 - 经济学人物 - 《金融与发展》 2020年6月号 - 国际货币基金组织季刊