This is part of the DR Book Collection.
If readers couldn’t tell, economics and the condition of the global poor are topics dear to my heart. Overall, I believe that globalization–particularly free trade and liberal immigration–benefits the least well off. But this largely looks at the problem from a broad, institutional standpoint. Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty by economists Abhijit Banerjee and Esther Duflo looks at the nitty-gritty details of the world’s poorest, providing the on-the-ground data necessary for constructing successful anti-poverty policies. The authors find five key factors that keep the poor trapped in poverty:
- Information deficiency: the poor often lack information, such as the benefits of immunization or early education.
- Lack of access: the poor lack access to things taken for granted by the non-poor: clean water, financial institutions, etc. They therefore bear the responsibility for all of these aspects.
- Missing markets: the conditions for favorable markets to emerge are often lacking, thus depriving the poor of their benefits.
- The Three ‘I’s: it’s not conspiratorial elites, but the ignorance, ideology and inertia of policymakers that lead to failing policies.
- Self-fulfilling prophecies: low expectations of both politicians and the poor themselves provide no incentive to improve and thus create self-fulfilling prophecies.
The book was eye-opening to say the least. You can see a TED talk by Esther Duflo below.