Indian-American Mr. Abhijit Banerjee, Ms. Esther Duflo and Mr. Michael Kremer have been awarded the Nobel Prize in Economics for their "experimental approach to alleviating global poverty". The Royal Swedish Academy announced on October 14, 2019 that in the last two decades, the Economics Laureates' new experiment-based approach has transformed development economics, which is now a flourishing field of research. The prize money of 9 million Swedish kroners will be shared equally between the three Laureates.
Mr. Banerjee and Ms. Duflo are married to each other. Mr. Banerjee, 58, and Ms. Duflo, 46, are both professors at the Massachusetts Institute of Technology (MIT) in the US, while Mr. Kremer, 54, is a professor at Harvard University. Ms. Duflo is only the second woman to win the Nobel Economics Prize in its 50-year existence, following Ms. Elinor Ostrom in 2009. She is also the youngest person to ever receive the Economics Nobel Prize.
The fundamental contribution of Mr. Banerjee, Ms. Duflo and Mr. Kremer was to develop an experimental approach to development economics. They built a scientific framework and used hard data to identify causes of poverty, estimate the effects of different policies and then evaluate their cost effectiveness. Specifically, they developed Randomised Control Trials (RCTs) to do this. They used these to study different policies in action and to promote those that were most effective.
