Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty

Poor Economics : A Radical Rethinking of the Way to Fight Global Poverty
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Title: Poor Economics : A Radical Rethinking of the Way to Fight Global Poverty
Goodreads Rating: 4.26
Book URL: GoodReads.com
Winner of the 2011 Financial Times/Goldman Sachs Best Business Book of the Year Award Billions of government dollars, and thousands of charitable organizations and NGOs, are dedicated to helping the world's poor. But much of their work is based on assumptions that are untested generalizations at best, harmful misperceptions at worst. Abhijit Banerjee and Esther Duflo have pioneered the use of randomized control trials in development economics. Work based on these principles, supervised by the…

I liked this book. Very thorough, practical and measured approaches to uplifting people form poverty and kicking off a virtuous cycle in their lives. The authors examined several randomized trails in different countries, what impact they had on people’s behavior — you will be surprised by some outcomes.

Poverty traps, why potatoes increased world population, what kind of promotion will get people to buy mosquito nets, procrastination, antibiotics, spending on health etc. — very good topics in this book. If you are interested in knowing how the poor behave (w.r.t. spending money), why it’s not easy to end poverty, this book is a must read for you.

Poverty traps are really treacherous, one needs to have a lot of conviction to come out of it with out direct external help. This book clearly explains why it’s so difficult and why many people often do not come out of that trap. Having seen those first hand, I can say the observations and solutions the authors outlined are very valuable.

What’s the most important take away? Help one person in a poor family get out of poverty trap, that will help the whole family for generations to come. May be more in some cultures and less in some cultures, but it helps. And government policy is not the only solution.