The winners of the Nobel Prize show how economics, when done right, can help us solve the thorniest social and political problems of our day. Figuring out how to deal with today’s critical economic problems is perhaps the great challenge of our time. Much greater than space travel or perhaps even the next revolutionary medical breakthrough, what is at stake is the whole idea of the good life as we have known it. Immigration and inequality, globalization and technological disruption, slowing growth and accelerating climate change–these are sources of great anxiety across the world, from New Delhi and Dakar to Paris and Washington, DC. The resources to address these challenges are there–what we lack are ideas that will help us jump the wall of disagreement and distrust that divides us. If we succeed, history will remember our era with gratitude; if we fail, the potential losses are incalculable. In this revolutionary book, renowned MIT economists Abhijit V. Banerjee and Esther Duflo take on this challenge, building on cutting-edge research in economics explained with lucidity and grace. Original, provocative, and urgent, Good Economics for Hard Times makes a persuasive case for an intelligent interventionism and a society built on compassion and respect. It is an extraordinary achievement, one that shines a light to help us appreciate and understand our precariously balanced world. In this ambitious, provocative book Abhijit V. Banerjee and Esther Duflo show how traditional western-centric thinking has failed to explain what is happening to people in a newly globalized world: in short Good Economics has been done badly. This precise but accessible book covers many of the most essential issues of our day–including migration, unemployment, growth, free trade, political polarization, and welfare. Banerjee and Duflo will confound and clarify the presumptions of our times, such as: why migration doesn’t follow the law of supply and demand, why trade liberalization can drive unemployment up and wages down, why macroeconomists like to bend the data to fit the model, why nobody can really explain why and when growth happens, why economists’ assumption that people don’t change their minds has made has made polarization worse, and why quite often it doesn’t take a village, especially if the villagers aren’t that nice. In doing so, they seek to reclaim this essential terrain, and to offer readers an economist’s view of the great issues of the day–one that is candid about the complexities, the zones of ignorance, and the areas of genuine disagreement.
About the Authors:
Abhijit Banerjee, winner of the 2019 Nobel Prize in Economics, is the Ford Foundation International Professor of Economics at the Massachusetts Institute of Technology, and a co-founder and co-director of the Abdul Latif Jameel Poverty Action Lab (J-PAL). In 2011, he was named one of Foreign Policy magazine’s top 100 global thinkers. Banerjee served on the U.N. Secretary-General’s High-level Panel of Eminent Persons on the Post-2015 Development Agenda. He lives in Cambridge, Massachusetts.
Esther Duflo, winner of the 2019 Nobel Prize in Economics, is the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics in the Department of Economics at the Massachusetts Institute of Technology and a co-founder and co-director of the Abdul Latif Jameel Poverty Action Lab (J-PAL). Duflo is a member of the American Academy of Arts and Science, and has received numerous academic honors and prizes including the Princess of Asturias Award for Social Sciences (2015), the Infosys Prize (2014), the Dan David Prize (2013), a John Bates Clark Medal (2010), and a MacArthur “Genius Grant” Fellowship (2009). Duflo is a member of the President’s Global Development Council and a Founding Editor of the American Economic Journal: Applied Economics, and is currently the editor of the American Economic Review. She lives in Cambridge, Massachusetts.
How these 2 Nobel winners are challenging popular economics
Good Economics for Hard Times by Abhijit V. Banerjee & Esther Duflo Reviews:
“Carefully argued and backed with research…Good Economics is an effective response to Banerjee and Duflo’s more thoughtful critics, some of whom argued that devotion to randomised trials had led to a narrowing of economics, in which complex questions that could not be scientifically tested should simply be set aside. The authors make a convincing case that empirical economics contains answers to many vexing problems, from populism to identity politics, especially when economists are willing to range outside their discipline’s confines.”—Financial Times
“One of the things that makes economics interesting and difficult is the need to balance the neat generalities of theory against the enormous variety of deviations from standard assumptions: lags, rigidities, simple inattention, society’s irrepressible tendency to alter what are sometimes thought of as bedrock characteristics of economic behavior. Banerjee and Duflo are masters of this terrain. They have digested hundreds of lab experiments, field experiments, statistical studies, and common observation to find regularities and irregularities that shape important patterns of economic behavior and need to be taken into account when we think about central issues of policy analysis. They do this with simple logic and plain English. Their book is as stimulating as it gets.”—Robert Solow, Nobel Prize winner and emeritus professor of economics, Massachusetts Institute of Technology
“A magnificent achievement, and the perfect book for our time. Banerjee and Duflo brilliantly illuminate the largest issues of the day, including immigration, trade, climate change, and inequality. If you read one policy book this year — heck, this decade – read this one.”—Cass R. Sunstein, Robert Walmsley University Professor at Harvard University, and author of How Change Happens
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