Development and Underdevelopment in the History of Economic Thought

Poverty Theory and Practice: Contribution of Abhijit Banerjee and Esther Duflo

Nureev Rustem, Financial University under the Government of Russia

The report is devoted to the theory and practice of combating poverty, starting from G. Myrdal and A. Deaton and ending with A. Banerji and E. Duflo. The population explosion in developing countries exacerbated the problem of poverty, as it contributed to a sharp reduction in mortality and an increase in life expectancy of the population. As a result, many scientists began to study ways and methods to narrow the gap that exists in the per capita consumption of the poor and rich countries. Gunnar Myrdal, the 1974 Nobel Laureate, was one of the first to put in his third world research center not problems of growth, but problems of poverty and poverty and ways to overcome them. A special section is devoted to the experience of Grameen Bank in the use of microcredit to combat poverty in Bangladesh. The works of A. Banerji and E. Duflo took this experience into account, but are not limited to it and find new methods to increase the effectiveness of the fight against poverty. In the center of research of Nobel laureates, not questions of theory, but questions of practice. To this end, they use a randomized approach. Since it is very difficult to set up a controlled experiment, scientists are forced to rely mainly on observations. To this end, they compare the results of the control sample with the sample in which the experiment takes place. The research findings were summarized in a book published in 2011, entitled “The Economy of the Poor: A Radical Rethinking of the Way to Combat Global Poverty.” The work consists of 10 chapters, which analyze the experience of helping international organizations in Asia and Africa. They relate to various aspects of the life of the poor. The new Nobel laureates prove that the means to combat poverty must be sought together with the recipients of this assistance. This allows you to dramatically increase its effectiveness.

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Keywords: population explosion, poor economics, ultra-poor, poverty alleviation methods, microcredit, human capital, development economics

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