Esther Duflo, a Nobel Prize-winning economist and co-founder of J-PAL, shares her transformative journey from observing economic practices in the Soviet Union to advising governments on poverty reduction. She discusses how mentorship amplifies cash transfers, the dangers of fixating solely on growth rates, and the unique child-rearing practices in France. Duflo also reflects on geographic mobility decline in the U.S. and what rock climbing teaches about empirical economics, while intertwining her daily life experiences with music.
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insights INSIGHT
Effective Poverty Intervention
Cash transfers combined with coaching yield exceptionally high returns in poverty reduction.
Coaching helps recipients avoid early liquidation of assets and teaches essential business skills.
insights INSIGHT
Microcredit Use
Microcredit borrowers often use loans for consumption or durable goods, not business investments.
This explains lower-than-expected growth despite high interest rates and repayment.
question_answer ANECDOTE
Management Style
Esther Duflo's management style is not micromanagement.
She gives a clear vision, then grants ownership to her team, fostering effort and creativity.
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Published in 1866, 'Crime and Punishment' is a psychological novel set in St. Petersburg, Russia. It revolves around Rodion Raskolnikov, an impoverished and intellectually gifted former student who formulates a theory that some individuals are morally justified in committing crimes for the greater good of society. Raskolnikov puts this theory to the test by murdering an old pawnbroker and her half-sister, leading to a profound exploration of his psychological and emotional struggles with guilt, paranoia, and the consequences of his actions. The novel delves into socio-economic disparities, moral dilemmas, and the psychology of criminals, making it a classic of Russian literature and existential thought[2][4][5].
Good Economics for Hard Times
Better Answers to Our Biggest Problems
Abhijit Banerjee
Esther Duflo
In this book, Abhijit V. Banerjee and Esther Duflo tackle the major economic issues of our time, such as immigration, job losses due to automation and trade, inequality, and climate change. They argue for intelligent interventionism and a society built on compassion and respect, using their experiment-based approach to provide clear and accessible explanations. The book covers essential issues like migration, unemployment, growth, free trade, political polarization, and welfare, and offers practical solutions based on decades of research[2][3][5].
Esther Duflo’s advice to students? Spend time in the field. “It's only through this exposure that you can learn how wrong most of your intuitions are and preconceptions are,” she explains. For Duflo, it was time spent in the Soviet Union on the brink of collapse. While there she saw how Jeff Sachs used the tools of economics to advise policymakers on matters of crucial importance. To her it seemed like the best job in the world—and she began to pursue it in earnest. Now it is she who is advising governments on how best to reduce poverty, having co-founded one of the leading policy research centers in the world. That work, together with that of frequent collaborators Abhijit Banerjee and Michael Kremer, has now been honored with the Nobel Prize.
She joined Tyler to discuss that work, including how coaching increases the effectiveness of cash transfers, why she cautions against falling in love with growth rates, what France gets right about child-rearing, the management philosophy behind her success building J-PAL, how she briefly became the face of an anti-Soviet revolution, the under-looked reasons behind the decline of geographic mobility in the United States, what rock climbing can teach us about being a good empirical economist, her daily musical move from Bach to Bob Dylan, and more.
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