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Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty
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Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty

4.18 of 5 stars 4.18  ·  rating details  ·  3,896 ratings  ·  363 reviews

Billions of government dollars, and thousands of charitable organizations and NGOs, are dedicated to helping the world's poor. But much of their work is based on assumptions that are untested generalizations at best, harmful misperceptions at worst.

Abhijit Banerjee and Esther Duflo have pioneered the use of randomized control trials in development economics. Work based on

Kindle Edition, 321 pages
Published March 27th 2012 by PublicAffairs (first published April 26th 2011)
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Well this is a welcome breath of fresh air into the dreary little world of development economics.

The contemporary debate over the questions of aid and poverty reduction have been restricted to two equally excitable schools - Jeffrey Sach's 'clinical economics', where he asserts that massive increases of aid are necessary across a broad spectrum of problems, and William Easterly's focus on locally-driven reforms. Easterly has a vicious criticism of Sachs, mocking its paternalistic tone and simila
Ronald Barba
Poor Economics doesn't simply offer a unilateral view of how to fight global poverty; rather, this book offers views from both sides of the foreign aid debate (e.g. Sachs v. Easterly) and provides examples of different organizations that have dealt with attacking poverty on both small and large scales.

There are five key takeaways from Poor Economics, with regard to any localized campaigns attempting to improve the lives of the poor:

1) Individuals/communities inherently believe that outside orga
This kind of book can be annoying, as popular social science tends to fall into one of two camps. The first are those that just repeat a single idea over an over again (e.g. The Tipping Point). The second are those that simply rehash 101 textbooks, adding a few kooky examples or anecdotes (e.g. The Undercover Economist).

To some extent, this book is vulnerable to both those criticisms. The authors make a big push on the importance of empirical evidence in designing interventions – using randomize
Ben Thurley
Banerjee and Duflo have written a great book that aims to see poverty as a “set of concrete problems that, once properly identifed and understood, can be solved one at a time.” Using the best economic and observational evidence (often taken from randomised trials) they build a case for what actually works in helping overcome poverty, taking up the fight against what they argue are the biggest barriers –ignorance, ideology and inertia.

It is thoughtful and rigorous, though possibly slightly too te
I mentioned this book on my blog here,, and now I finally read it!

I'll admit I was a little disappointed that the book wasn't as detailed as her lecture on the actual experiments the Poverty Action Lab has been involved in. There was much more on larger picture topics and brief summaries of experiments and how they contributed to the dialogue on how to address that particular topic within development circles.

That said, it was still a fascinating read and
This is one of the best "pop-economics" books I have read in a very long time. Such books typically follow the same recipe: top academic seeks recognition outside the profession and writes the book propounding the theory, enlisting in support loads of evidence consistent with the theory, and curiously brushing off/forgetting to mention most of any evidence even vaguely incompatible with the main argument of the book. The book tends to go on forever repeating the same score in all possible tonali ...more
Greg Stoll
Poor Economics is about the world's poor (living on the equivalent of 99 cents a day, not including housing) and how best to help them. There are basically two broad schools of thought on how to help: for example, in education one group (the "supply wallahs") says we just need to get kids into schools with good teachers, and the rest will take care of itself. (i.e. ensuring the supply of education will solve the problem) The other group (the "demand wallahs") says there's no point in doing this ...more
No this is not about how useless economics had become under the hegemony of the Chicago School of Free Market Fundamentalism. This is about the economics of being poor. And refreshingly instead of focusing on the theories of poverty and the decision making of the poor, it is based on large scale, many country research asking those on less than a $1 a day how they make decisions on how they spend their money, what food to eat, what health care to seek, what education to try to get their children. ...more

What happens when a government or NGO infuses large sums into a third world country? The answer -- lots happens. If there is a poor governmental or regulatory structure, some persons become inordinately wealthy by siphoning off funds, some organizations benefit at least for the short term, sometimes important changes begin within the country. How can one predict which will happen? That is what the book is about.

Banerjee reviews his own research and that of others to respond to the question. He
Harvard economist who has studied poverty from a randomized control type perspective. He does so humanely with specific case studies. He questions assumptions such as are bed nets really not used by poor people when given to them rather than when they have to pay for them, why is is so hard for poor people to save, what are the reasons that people access curative services but not preventative services? Is overpopulation really keeping countries in poverty or are large families worse for children ...more
I really liked this book. Essentially the authors provide a literature review on previous studies that have been done in economic development. The emphasis is on random controlled trials, where an intervention is introduced to one group and the effects are compared to a control group. I definitely feel like there's a dearth of studies in the field of development, and at its core the book is an appeal for more rigorous studies in the field of development. It was interesting to read some of the co ...more
Poor Economics is a great, important, and easy read. It's not written with a terribly technical voice, so even readers that lack training in economics will have no problem grasping its content.

The book is essentially a compilation of anecdotal stories used as evidence for the authors' micro analyses on a macro issue: global poverty. The overall message of the book is that the traditional macro approaches to fighting poverty (Foreign Aid) are not working because there is no care taken for the mic
Hesitated between 3 and 4 star.
Not a very charismatic book, quite "wordy" and kind of gets lost in descriptions. but makes good sense.
There is no snap action or conclusions, however, a more concise way of writing could make reading easier. For someone who has time to read, it does describe the complexities, which one often overlooks ... !


Winner of the 2011 Financial Times/Goldman Sachs Best Business Book of the Year Award

Billions of government dollars, and thousands of charitable org
One of the most daunting obstacles economists and other social scientists face when observing the real world in an empirical way is a lack of control. It is notoriously difficult to establish randomized, controlled experiments in the real world, because unlike laboratory settings, the real world cannot be controlled by setting all conditions equal except for one, in order to measure the impact of that particular factor. There are serendipitous occasions when such randomized trials emerge through ...more
a good, quick read that highlights a lot of the lessons learned from RCTs in development over just the past few years. Occasionally frustrating in its effort to still position itself in the context of the sachs/easterly debate, which isn't, to me, a useful dialectic (though admittedly one that has dominated the field for a decade). the book shines when it gets into the nitty-gritty of the work j-pal and its affiliate researchers do, and the accompanying Web site is indispensable. Banerjee and Du ...more
James Van
I thought I was going to love this book, but I didn't really get much out of it.

It was a summary of "some aid is good aid" which I already believe, so I guess the persuasion wasn't attractive to me. The details, though, were mostly things I'd already heard or read. I think watching Esther Duflo's TED talk might give away most of the information and excitement of this book.

If you're wondering why not everyone agrees with "The End of Poverty" then maybe this book would impress you. Or if you're st
This book is awesome.

It is both academic and accessible. It deeply affected my thoughts on poverty (both international and local) and economics.

It explores the effects of various types of aid to the abject poverty of the third world through Randomized Controlled Trials (RCTs) -- you know, structured experiments with control populations the way you expect to see them through the rest of the science world. Through the analysis of what worked, what didn't, and why, they build a compelling psycholo
Sai Kishore
"Economic institutions shape economic incentives,the incentives to become educated,to save and invest,to innovate and adopt new technologies,and so on.Political institution determines the ability to citizens to control politicians" - Acemoglu & Robinson
A wonderful read. Instead of trying to find a universal, one-time solutions or principles/formulas like other lame books, this one delivers valuable lessons about working from the bottom up, with specific cases. Very informative and challenging material, yet it could have been better if the book can expand its examples' scope.
Ricardo R.cepeda
It's an excellent book. I highly recommend it to those interested in poverty's causes. Esther and Abhijit lay out a bunch of important concepts and theories about poverty in a very compelling and clear way. Once you have read the book,your perception change radically.
Living in a developing country, I witness the plight of the “poor” or people who live under 99c a day quite regularly. I’d always blame the government for not taking care of its underprivileged citizens. The most I would was donate a sum of money to a charity or NGO group which claims to be helping the poor in acquiring basic necessities, such as clean drinking water, food and clothes.

Reading this book has allowed me to somewhat understand the complexities of the poor, and how even trying to he
One of the best books I've read this year. Covers a wide range of the issues in fighting poverty on a particularly even handed fashion.
As a current Peace Corps Mexico volunteer, I bought this book to give me additional perspective on my experience and maybe even insight into how I can better tackle my job. Having been in country for over a year now I was happy to see many of my observations explained in the book. There are times where the book becomes almost too academic and strays from the complexity of poverty. However, I could easily tell that the writers have spent a lot time on the ground and not just behind some desk read ...more
Mal Warwick
Must Reading About Global Poverty and the Contrasting Approaches to Combat It

Public debate about the way to combat global poverty has ricocheted between two extremes. One was summed up in 2005 in The End of Poverty by Jeffrey Sachs, the Columbia economist who spearheaded the UN Millennium Development Goals. The other was laid out by former World Bank economist William Easterly the following year in The White Man’s Burden. Sachs advocates massive government-to-government foreign aid. Easterly dep
I started this book for a MOOC that a friend of mine recommended. It was a combination of curiosity about global poverty, peer pressure, and interest in seeing how MOOCs run that got me into it. The course proved so laborious and difficult to manage in a hectic personal year for myself that I just stopped working on it. Lectures were broken up into bite-sized portions with "finger exercises" - brief multiple choice questions designed to see if you had actually paid attention - that made lectures ...more
"Poor Economics" was such an enjoyable and enlightening read; and even more so having read it as the companion "textbook" with the edX online class, "Challenges of Global Poverty", with the authors of the book, Professors Duflo and Banerjee.

Duflo and Banerjee are renowned M.I.T. development economists, having conducted numerous randomized controlled trials (RCTs) to understand the poor's way of thinking of how they make life decisions concerning their family's health, education, savings, insura
Initially, I began reading this book as part of a Massive Open Online Course (MOOC), but had to take a break due to a busy schedule and low motivation after spring break. Poor Economics, written by two MIT economists, Esther Duflo and Abhijit Banerjee, takes an interesting look at the processes of getting into and out of poverty. The authors are explicit in their statement that there is no silver bullet to end poverty. However, there are means by which individuals can get out of poverty but thes ...more
Josh Meares
I really enjoyed Banerjee and Duflo's book! They have interacted with most of the major current opinions on the big issues in development thinking: Sachs, Easterly, Collier, etc. But their focus is less on the "right" aka perfect way to set up and improve the big institutions, and more on what is actually provably working and not working in the field and why.

In their own words, "The positions that most rich-country experts take on issues related to development aid or poverty tend to be colored
I listened to the audio version of this book, downloaded from

The authors basic question is whether or not there is a "poverty trap" and their basic means of exploring this question are randomized experiments in which people are randomly assigned to get misquito nets, or food subsidies, or microcredit, or have savings accounts established for them, etc. The authors are quite proud of this methodological advance; I am appalled that techniques known to statisticians for decades, probab
Before I begin, I want to let you know the angle I'm reviewing this book from.
1. I don't usually read non-fiction because I sometimes find them tedious, so part of this rating is based on how easy it was to read
2. I'm from a developing country, so part of this rating comes from the way the authors discuss development and the ideas involved
3. I'm an Economics major, so I do have a working knowledge on some of the things they talk about, so I can't be completely sure how clear the book is for peop
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Abhijit Vinayak Banerjee is an Indian economist. He is currently the Ford Foundation International Professor of Economics at the Massachusetts Institute of Technology. Banerjee is a co-founder of the Abdul Latif Jameel Poverty Action Lab (along with economists Esther Duflo and Sendhil Mullainathan) and a Research Affiliate of Innovations for Poverty Action, a New Haven, Connecticut based research ...more
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“But then it is easy, too easy, to sermonize about the dangers of paternalism and the need to take responsibility for our own lives, from the comfort of our couch in our safe and sanitary home. Aren't we, those who live in the rich world, the constant beneficiaries of a paternalism now so thoroughly embedded into the system that we hardly notice it?” 5 likes
“We must arm ourselves with patience and wisdom and listen to the poor what they want. This is the best way to avoid the trap of ignorance, ideology and inertia on our side.” 4 likes
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