HOW TO ALLEVIATE POVERTY: LESSONS FROM THE 2019 NOBEL PRIZE IN ECONOMICS

Abstract

In 2019, Esther Duflo, Abhijit Banerjee and Michael Kremer were awarded the Nobel MemorialPrize in Economic Sciences “for their experimental approach to alleviating global poverty.” This approachis mainly based on randomized controlled trials (RCTs). Therefore, a goal of the paper is to analyzeand review major findings of the Nobel Prize winners and to show directions for their applicationin Central Asia. The methodology of the paper is based on the analysis of RCTs conducted by the NobelPrize winners and in Central Asia. The paper finds that there are a lot of factors restricting poverty alleviationin developing countries, including underdevelopment of educational and healthcare systems.These problems can be addressed using experimental studies in different fields. The paper also reviewsthe main findings of the Central Asia-based RCTs. Their results were positive in terms of identifyingproblems and providing solutions that can be useful for further policymaking and can positively affect institutional,educational, healthcare and social issues. The paper shows that the potential priority sectorsfor the regional RCTs are educational and agricultural policies, where they can be conducted in orderto test the efficiency of the existing programs and develop recommendations for future policy improvements.However, the RCTs alone are not enough for poverty alleviation and the paper emphasizes onthe essential role of economic growth. The paper can be useful for policymakers, who form anti-povertypolicy and development programs.