Research helps fight world poverty
The Laureates Esther Duflo, Abhijit Bannerjee and Michael Kremer have jointly been awarded the Prize in Economic Sciences in Memory of Alfred Nobel "for their experimental approach to alleviating global poverty." One of their most significant contributions was introducing field experiments into research on development economics, explains Per Strömberg, professor of Economics at the Stockholm School of Economics, and a member of the Economic Sciences Prize Committee.
"Their work has totally transformed the way research is done in development economics. It has gone from a very macroeconomic approach to focusing on how to solve microeconomic issues to alleviate specific problems for poor people around the world," Strömberg says.
This shift from macro to micro, has meant that development economics has become much closer to practical policy.
"Rather than basing policies on perceived problems, researchers try to identify the specific mechanisms behind the challenges at hand, taking into account specific regional and social circumstances," Per Strömberg adds.
Based on scientific evidence
Strömberg takes immunization rates as an example. It was long assumed the rates were low due to prohibitive costs but making the vaccines available for free didn't improve vaccination rates by any significant amount. An experiment with mobile clinics, however, saw rates increase by more than 50 percent. And giving the patients a bag of lentils after their vaccination saw numbers improve even further.
This proved that it wasn't the cost of the vaccination, but rather a question of time and priorities. With clinics understaffed and far away from the communities, families prioritized a day of labor, getting food for their families, rather than spending a day travelling only to arrive at an empty clinic.
"The essence of our research is to make sure that the fight against poverty is based on scientific evidence," Esther Duflo highlighted during the press conference on Monday.
This year's prize also sees a win in wider representation. Abhijit Bannerjee is the third male winner who is not white. Esther Duflo's win is even more historical. She is the second woman to be awarded the prize since it was instituted in 1968 – and the youngest ever.
"Showing that it is possible for a woman to succeed and be recognized for success I hope is going to inspire many, many other women to continue working and many other men to give them the respect they deserve," Esther Duflo said at the press conference.
Not technically a Nobel Prize
The Prize in Economic Sciences is not actually a Nobel Prize – although for all intents and purposes it is treated the same as its prestigious siblings. The prize was instituted in 1968 by Sweden's central bank (Sveriges Riksbank) and is officially known as "The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel". Since its inception, the prize has been awarded by the Royal Swedish Academy of Sciences according to the same principles as for the Nobel Prizes that have been awarded since 1901.
Stockholm School of Economics and the Nobel Prize
Stockholm School of Economics is proud to be represented by two faculty members on the Economic Sciences Prize Committee – Per Strömberg and Magnus Johannesson.
Per Strömberg is the SSE Centennial Professor of Finance and Private Equity at the Stockholm School of Economics. His award-winning research has focused mainly on the areas of bankruptcy and private equity finance.
Magnus Johannesson a professor at the Department of Economics. He is well-known for his research in the field of experimental economics with a particular focus on health. Both are members of the Royal Swedish Academy of Sciences.
Abhijit Banerjee, born 1961 in Mumbai, India. Ph.D. 1988 from Harvard University, Cambridge, USA. Ford Foundation International Professor of Economics at Massachusetts Institute of Technology, Cambridge, USA.
Esther Duflo, born 1972 in Paris, France. Ph.D. 1999 from Massachusetts Institute of Technology, Cambridge, USA. Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics at Massachusetts Institute of Technology, Cambridge, USA.
Michael Kremer, born 1964. Ph.D. 1992 from Harvard University, Cambridge, USA. Gates Professor of Developing Societies at Harvard University, Cambridge, USA.