News and Announcements
Get those economists started early! IPA Research Affiliate John List created headlines in Chicago with a special economics course designed and taught to 8th graders by U Chicago professors:
Several eighth-grade students in Chicago Heights School District 170 are taking an economics class taught by instructors from the University of Chicago.
Twenty eighth-graders representing all nine District 170 elementary schools are learning about economics in an 11-session course that will end this month. A second group of 20 District 170 students will take the same course starting in January.
The economics class is the brainchild of District 170 Supt. Thomas Amadio and University of Chicago economics professor John List.
“This is probably only one of a handful of middle school social sciences classes in the country that teaches ideas like opportunity cost or supply-and-demand in an experiential way,” List said.
The students were selected after an application and interview process conducted by Amadio and other District 170 administrators.
“Economics and technology are the future, and I want to increase my knowledge of both,” said Wilson School eighth-grader Dante Jones, who is one of the students taking the course.
The class is held in the District 170 Distance Learning Center at Washington-McKinley School in Chicago Heights. Each student is provided a laptop computer, and the DLC is equipped with state-of-the-art technology.
Update: Check out this video of District 170 students interacting with their instructors, and get more info on the program.
IPA's New Haven-based Data Coordinator, Matt White, was featured in a video interview with the New Haven Register where he discusses his experience working with IPA's Urban Micro-Insurance Project in Kenya.
Jua Kali is both a place and a type of freelance worker in Nairobi, Kenya, where White devoted a year of his life. It’s where hundreds of poor metalworkers are helping White find out if new economics can solve some age-old problems.
“People are living in destitute poverty. You’re stepping over streams of sewage, and kids are just running around,” says White, data coordinator for Innovations for Poverty Action, a New Haven-based nonprofit. “Jua Kali is where they work. Always in the background there, you can hear the sound of hammers.”
White spent parts of 2010 and 2011 in Kenya to test one of the hottest topics in global economics: micro health insurance. This is the idea of providing very cheap health insurance to poor workers who have little or no access to basic health care.
“Micro health insurance has become increasingly popular,” White, 23, explains. “Money is being spent on it. But does it work? Is it worth investing in?”
That’s where White’s group enters.
Innovations for Poverty Action steps in, develops a randomized control study of the situation, conducts the study and determines whether or not an anti-poverty program is having the desired effect. The subjects range from school attendance and agriculture to clean water and mosquito nets.
IPA has completed more than 80 such studies since 2002 and has more than 300 ongoing projects in dozens of countries, including the U.S.
“There are things you can’t know by just guessing,” White says. “You can either just go along thinking that something that seems like a good idea is a good idea, or you can do a scientific evaluation.”
Read the entire article and watch the video here.
From Psychologist Art Markman, Ph.D.'s HuffPost blog, IPA Research Affiliate Eldar Shafir's research is highlighted in showing how a positive or negative outlook can impact one's life.
When you are focused on the negative side of things, you often focus on rejecting options rather than selecting them. Witness what is happening with the GOP primaries now. Republican voters are focused on eliminating candidates rather than finding ones they like. Research by Eldar Shafir shows that when people are trying to reject options, they weigh the negative information about the options more heavily than the positive information.
Summary: "Steven Radelet’s accessible new book argues that much of the credit for Africa’s recent economic boom goes to its increasingly open political systems. But Radelet fails to answer the deeper question: why some countries have managed to develop successful democracies while others have tried but failed."
It is well known that the 1970s, 1980s, and 1990s were a disaster for the countries of sub-Saharan Africa. In a period when other underdeveloped regions, especially Asia, were experiencing steady economic growth, Africa as a whole saw its living standards plummet. Nearly all Africans lived under dictatorships, and millions suffered through brutal civil wars. Then, in the 1990s, the HIV/AIDS epidemic exploded, slashing life expectancy and heightening the sense that the region had reached rock bottom. It was no surprise when an intellectual cottage industry of Afro-pessimists emerged, churning out a stream of plausible-sounding explanations for Africa's stunning decline. The verdict was simple: Africa equaled failure.
What is less well known is that Africa's prospects have changed radically over the past decade or so. Across the continent, economic growth rates (in per capita terms) have been positive since the late 1990s. And it is not just the economy that has seen rapid improvement: in the 1990s, the majority of African countries held multiparty elections for the first time since the heady postindependence 1960s, and the extent of civic and media freedom on the continent today is unprecedented. Even though Africa's economic growth rates still fall far short of Asia's stratospheric levels, the steady progress that most African countries have experienced has come as welcome news after decades of despair. But that progress raises a critical question: what happened?
Steven Radelet's accessible and insightful new book, Emerging Africa, joins a growing chorus of voices explaining how and why Africa has turned the corner. Radelet, who joined the U.S. State Department to work on international development issues last year, was a fellow at the Center for Global Development and has served as a policymaker in both the United States and Liberia, where he advised President Ellen Johnson-Sirleaf. He does a remarkable job of weaving together hard statistical patterns, case studies, and a coherent narrative that explains both Africa's decline and its recent rebound. The book is useful reading both for specialists in the field, who will gain from its detailed description of the experiences of numerous countries, and for those newly interested in Africa, including non-economists, who will find their preexisting notions about the continent overturned. Emerging Africacrystallizes the new conventional wisdom on Africa's recovery. But it also highlights gaps in experts' understanding about its underlying causes.
Read the full review here.
Stephen P. Groff, a member of IPA's Policy Advisory Board and Vice President of Asian Development Bank, writes a compelling statement on how to approach aid effectively, using Korea as an example:
Aid to Asia is coming under particularly intense scrutiny. Many see the growing affluence and ample state coffers in some Asian nations, and understandably question why the region needs foreign aid. Behind this sparkling veneer, however, is another face of Asia, the more than 1.6 billion people who eke by on less than $2 a day -- less than the price of a small Starbucks latte. Asia's poor desperately need the health, education and other social services that foreign aid brings. For the sake of these 1.6 billion, and to better ensure the stability of the region; it's imperative that aid not be cut.
It is equally essential, however, that we ensure this aid delivers as promised, giving donor nations value for money, and poor families a better life. Good intentions are not enough.
A textbook example of how aid can work effectively can be found in the Republic of Korea, where global development partners are meeting in Busan for the Fourth High Level Forum on Aid Effectiveness. Having leapfrogged from "third world" status to a developed country within the course of a single generation, Korea provides a shining example of a country that made development assistance work.
Armed with data, an MIT lab offers fresh insight on some of the world’s most vexing problems
IPA's partner organization, J-PAL, is featured in the Boston Globe highlighting IPA Research Affiliates Esther Duflo and Abhijit Banerjee. Paired with an interesting infographic, the article brings more attention to evidence-based development and research that has followed the publication of Duflo and Banerjee's Poor Economics.
It’s no one’s idea of an MIT laboratory: not a beaker or an oscilloscope in sight. But in a wood-paneled suite, on the third floor of a bland, concrete building, researchers are tackling problems as complex and vexing as any in technology, science, or medicine.
This is the Abdul Latif Jameel Poverty Action Lab, or J-PAL, where economists through precise, detailed studies are trying to find ways to alleviate poverty. For nearly a decade, MIT economics professors Esther Duflo, and Abhijit Banerjee, have worked with a global network of researchers to conduct experiments in the world’s poorest places - where families live on less than $1 day - and reached conclusions that are changing the way economists and policy makers think about development in impoverished areas.
The findings are contained in their new book, “Poor Economics,’’ which earlier this month won the Financial Times and Goldman Sachs Business Book of the Year Award for “the most compelling insight . . . into modern business issues.’’ In the book, the MIT professors argue that antipoverty policies must be built on evidence from careful, controlled tests that detail how the poor live, act, and react.
Duflo and Banerjee came to the study of global poverty from very different starting points. To Duflo, who grew up in a comfortable, academic family in France, global poverty was a remote abstraction. For Banerjee, abject poverty was as close as the ramshackle houses behind his childhood home in Calcutta. They met at MIT when Duflo, as a student, took a course in development economics from Banerjee. After Duflo earned her doctorate in 1999 and joined the MIT faculty, the two founded the Poverty Action Lab in 2003.
Since then Duflo, 39, and Banerjee, 50, have received multiple honors and prizes. In 2010, Duflo was awarded the prestigious John Bates Clark Medal for the best American economist under 40. The year before, she received a MacArthur Fellowship, the so-called genius award.
What inspires their interest in poverty, Banerjee explained, is the idea that the poorest people must deal with different conditions than the rest of the world’s population.
From DevEx News: USAID's Chief Innovation Officer, Maura O'Neill, wrote an informative article on using innovation and systematic research to create sustainable development solutions, using IPA's Safe Water Program, specifically the Chlorine Dispenser project in Kenya, as an example.
Read the full text below or click here to open a window with the original article.
A few miles outside of Busia in Western Kenya, Carol Nekesa brings us out to a small village that is enjoying a regular supply of clean water for the first time. Next to the stream where the villagers regularly fill up their containers of water, a chlorine dispenser has been installed.
For years, we have known that adding a little bit of chlorine to water can kill the bacteria that make people sick. And getting sick from bad water can too often turn fatal for people already ravaged by disease.
But until recently, only 10 percent of Kenyan families have been using chlorine. Why was that and how could that change? Carol, a Kenyan from Busia, was part of a team that was pioneering not just a particular solution, but a systematic method for creating more cost-effective solutions again and again.
As the OECD Development Assistance Committee holds the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea, at the end of this month, we all seek better answers to “what works” in the fight against poverty. How can we uncover what people really will use to lift themselves out of extreme poverty and debilitating disease instead of what others think they need? How do we source and deploy solutions faster and cheaper? And how do we discover innovative ways to finance them?
Official Development Assistance as cataloged by DAC is now over $128 billion dollars a year. We need to be as prudent as possible with the U.S. taxpayer’s dollars and also leverage private investment. Net private capital flows to developing countries were as high as $1.1 trillion in 2007, according to the World Bank. While up from $152 billion, in just six years, with the global downturn, private investment was down in 2009 but still a big number: $598 billion. With our economic climate and the stakes as high as they are for so many in desperate poverty, we need to leverage every dollar as effectively as we can to deliver development results. We need to test what works — not just what products or services yield the highest impact for the lowest cost, but also what business or public sector deployment models allow for sustained impact.
Let’s return to Carol. She is the Kenya deputy country director for Innovations for Poverty Action, a nonprofit group whose members include some of the world’s foremost development economists. It is an organization dedicated to researching what works to fight poverty. Carol is part of a team of 500 researchers and practitioners in 40 countries that use tried and true methods pioneered by pharmaceutical researchers and adapted by leading economists to systematically test development solutions. As IPA researchers sought to improve chlorine uptake in Kenya, they considered adding chlorine to piped water like we do in most U.S. cities.
But Kenya’s desire to bring piped water to its 40 million people has far outstripped its financial and institutional abilities to do so in the last decade. Waiting for this infrastructure means millions of Kenyans would suffer from stunted growth or die in the meantime.
Researchers tried selling or giving away small bottles of chlorine so that people could add a little to their water jug. But people used the chlorine once or twice and the bottles then just decorated the shelf. It was only when researchers installed a dispenser right at the water hole that they saw terrific, persistent results. IPA manufactured the device in Kenya with a special valve imported from Minnesota. The dispenser capital costs (US$1 per person) were a tenth of the piped costs, with annual operating costs (30 cents U.S. per person) much less as well.
Suddenly, clean water for millions in rural East Africa could become a reality in the next decade if we figure out a sustainable financing model for scaling.
This article was originally published on DevEx's website on November 21.
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