Poverty, never think about it too much: the important thing is to act within the limits of the possible. Esther Duflo, the Parisian scholar, gave a lecture at the Trento Economics Festival in which she explained her concrete method for evaluating and carrying out development projects. Asking difficult and exaggerated questions, such as whether international aid will eliminate world poverty or whether growth is the best solution to end poverty, is useless.
The professor at MIT in Boston said it clearly, designated as one of the 100 most influential people in the world by Time magazine. Graduated in economics (but also in history) in the most prestigious Parisian faculties, she is co-founder of the Abdul Latif Jameel Poverty Action Lab, the MIT research laboratory, which carries out scientific evaluations on development programs against poverty all over the world. The young economist proposes an alternative approach to the fight against poverty: a method based on field trials which provides for systematic evaluations of the results.
In this it differs from the approaches of international bodies and governments: it does not set itself the goal of defeating poverty altogether, but of identifying specific problems and completing projects one by one. For years he has been conducting field research in many developing countries. In China he experienced that by decreasing the price of rice by 10% to encourage individuals to buy and eat more, the opposite result was actually obtained: less rice was consumed. Money that was no longer spent on cereal made people feel richer and prompted them to buy things, such as shrimp or cell phone credit, that they thought were more “luxury.”
The economist complains that many development projects do not take these preferences into consideration: they do not expect individuals to maximize utility and not their caloric needs. It is an aspect that needs to be reformed. In India, on the other hand, he has found a way to greatly increase the percentage of vaccinated children in the small villages of Rajasthan. It is necessary to build health camps and distribute a kilo of lentils for each immunized child.
The incentive in kind creates a notable difference: as many as 38% more children are subjected to prophylaxis (while there is an increase of 17% if only the health field is built without distributing lentils). Duflo does not betray its French traditions: “There are goods and services that we must be willing to subsidize forever – he declared -. We already do it: for example, in our countries vaccination is free and mandatory because the social benefit is greater than the private cost." The sustainability of society must always be considered as a whole: the cost of lentils is much lower than the social benefit deriving from immunization of children. Some say that Esther Duflo is more of an engineer than an economist because she solves specific problems, almost losing sight of the "big problem".
Yet governments and international institutions are not paying attention to it: "Because of ideology, ignorance and inertia", the economist underlined in Trento. But, according to Duflo, if you are willing to reform the systems, through inexpensive interventions, the effects and progress can be significant. So we must not try to defeat poverty, but we must achieve small successes that concretely improve the lives of some poor people: "we can all do it".
