Recently Read: “Poor Economics” by Abhijit V. Banerjee and Ester Duflo

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“Poor Economics” is required reading for anyone who cares about the poor and how to best structure aid to people who need economic help around the world.

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Unlike so many authors in this genre, Banerjee and Duflo are not out to make a case for a particular agenda, ideology or to castigate rich countries for not doing enough. Their book is a balanced, nuanced look at the daily economic decisions of the poor, the various structural and social forces that limit their ability to rise from poverty and the pros and cons of various techniques aimed at helping this huge section of humanity.

By carefully analyzing issues such as micro-credit, grants, government education policy, and the micro-psychology of the poor the authors not only educate us about what works and doesn’t but also take on some fundamental questions about seemingly “irrational” (in the economic sense) decisions the poor make every day — having “too many” children or taking advantage of free health care.

Short, well-written and full of insight at every turn, this is a book that forces the reader not just to hear about poverty but to attempt to understand it, which is the necessary precondition to developing real solutions that work not just in the conference rooms of developed workd institutions but in the day to day lives of those for whom poverty is life itself.

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