What it will take to rebuild trust in our economy: A conversation with Nobel prize-winning economist Esther Duflo
Source | LinkedIn | Scott Olster | Senior Editor at LinkedIn
MIT’s Esther Duflo likens her work as an economist to that of a plumber. Instead of relying on models and theories alone, she prefers to get her hands dirty, go out into the field and, through a combination of tinkering, educated guesswork and trial and error, stress test potential solutions to some of the world’s most stubborn challenges, like global poverty.
Why not first test out how very small loans to low-income borrowers affects their earning potential in a few cities, for example, rather than commit millions to a project based mainly on good intentions?
This approach to economics — which she has championed alongside her research partner and husband Abhijit Banerjee — sparked a sea change in the field, culminating in a 2019 Nobel Prize win for Duflo, Banerjee and Harvard’s Michael Kremer. Duflo, 47, is the second woman and the youngest person to receive an economics Nobel.
LinkedIn recently spoke with Duflo about what the win means for her career, how she approaches her research and the thinking behind her latest book, “Good Economics for Hard Times,” which she co-wrote with Banerjee. Below is an edited transcript of the conversation.
Congrats on the Nobel Prize. Did you have any idea this was coming?
Esther Duflo: It was completely out of the blue, since in economics it tends to be older people. I was not even in contention, in my opinion. They keep the cards very close to their chests. There are murmurings, but they are nonsense.
When you win something like this, does it mean you can breathe a sigh of relief, or does it mean the real work begins?
Neither. For most people, it comes much, much later in life, so this is kind of like when people have retired and it’s kind of a crowning achievement, and then you can look forward to a life on the lecture circuit.