One of the traditions of the Queensland branch of the Economic Society of Australia (ESA) is an end-of-year seminar on each year’s Nobel Prize in Economics winners. Given our location, it’s a bit hard to get the actual prize winners themselves to speak, so ESA (Qld) asks a local academic to speak about the winners and their contributions to economics. Earlier this month, Associate Professor Andreas Chai of Griffith University briefed the Economic Society on the 2019 Nobel prize winners, Abhijit Banerjee, Esther Duflo, and Michael Kremer, and the contributions they made to the field of economic development or, more specifically, poverty alleviation. Andreas joined me in my latest Economics Explained episode to share his thoughts on this year’s prize winners:

Randomised controlled trials & economic development

Andreas is Discipline Head of Economics and Business Statistics in the Griffith University Business School. He has previously worked at the Australian Productivity Commission and the Australian Treasury, where we were colleagues in the late 2000s. Andreas is well-placed to speak about economic development, as he has consulted to international organisations such as the United Nations Industrial Development Organization on economic development issues (see link below to his work).

Use these timestamps to jump right into my conversation with Andreas:

• 1:40 – is the Nobel Prize in Economics a real Nobel Prize? (NB at the current exchange rate, the 9 million Swedish Krona prize is work around 960,000 USD, which is shared equally among the winners)
• 5:40 – why did Esther Duflo, Abhijit Banerjee and Michael Kremer win the 2019 Nobel Prize?
• 9:00 – Limitations of traditional approach to economic development, with Andreas mentioning Jeffrey Sachs and Bono and critics such as William Easterly
• 16:00 – Bill and Melinda Gates Foundation and Abdul Latif Jameel Poverty Action Lab
• 17:50 – what is a randomised controlled trial? How one helped find the cure for scurvy.
• 22:40 – RCTs in poverty alleviation
• 31:25 – Dr Andrew Leigh MP as proponent of RCTs in policy analysis and development in Australia (e.g. see Andrew’s 2018 interview on RN Breakfast)
• 31:50 – ethical issues with RCTs?
• 33:20 – future Nobel Prize winners? Neuroeconomics as an emerging field
• 36:35 – Andreas’s own work on economic development issues; e.g. this UNIDO report on Household Consumption Patterns and the Sectoral Composition of Growing Economies