This is a deserved distinction for the new empirical economics, which generates evidence to inform public policies, to fight against poverty and for sustainable development. These awarded researchers innovated in the use of experimental methods. However, their main contribution is reminding us that economic science needs to be close to people to try to improve the world. This research line is one of the main axis of work in our Nova SBE NOVAFRICA Knowledge Center since its creation in 2011.
This is the Nobel Prize for the new development economics, to the new economics to some extent. This is the economics that puts the center of action in the empirical analysis, in the evidence to guide public policies, namely in the fight against poverty. The one that brought back economics to people, science that wants to be useful to humanity.
It should be noted that all three economists are in their 40s and 50s. Esther Duflo is not only the second woman to be awarded the economics Nobel Prize, but also she is only 46 years old. She is the youngest person to be given the Nobel Prize in economics (Kenneth Arrow, with 51, was the youngest until yesterday). This is a clear sign of the great influence and innovation of these researchers, namely Esther Duflo, the driving force of this group of researchers.
As top development economists, these awardees have made diverse contributions to the field. Banerjee dedicated particular attention to the political economy and the link to economic theory. Duflo wrote some of the most important articles ever on the role of women in development. Both helped bringing concrete evidence about the real (and modest) impact of microcredit in development outcomes. Kremer made history with his article linking the simple and cheap treatment of intestinal worms to the decrease of student absenteeism.
Above all, this award represents the systematic effort of the group of development economists of the MIT Poverty Action Lab since the 1990s to reach the developing world with science, in direct contact with the population and local development partners, by methodically asking what works and what does not work in the fight against poverty and for sustainable development.
This group initiated the application of experimental methods in the context of the impact evaluation of interventions linked to economic development. These methods allow establishing causality between specific public policies and beneficiaries’ outcomes. Today all the major anti-poverty institutions in the world stage, the World Bank, bilateral donors (DFID, USAID, Nordic agencies), international NGOs, work together with researchers in the field of development economics thanks to the pioneering work of these economists.
In Portugal, since 2011, our Nova SBE NOVAFRICA Knowledge Center, which is the knowledge center of Nova School of Business & Economics dedicated to research on the African economies, already carries a long list of experimental projects completed in Mozambique, Angola, Guinea-Bissau, Kenya, Gambia, in diverse areas like financial inclusion, education, health, political economy and governance, migration, in close relationship with local and international partners. Since 2011, we have obtained over 6 million euros from international agencies to undertake this research work, which places us at the forefront of Europe in this field.
We are very happy and even proud to be part of this movement placing economic science at the service of people, namely those facing the most severe difficulties and lack of economic opportunities around the world. This is a unique collective objective, which should touch us all in academia.
This text was written by Professors Cátia Batista and Pedro Vicente, Scientific Directos of the Nova SBE NOVAFRICA Knowledge Center regarding the three laureates of the Nobel Prize in Economic Sciences.
The illustration is credited to Johan Jarnestad/The Royal Swedish Academy of Sciences.