What works for a small-scale NGO-style intervention may not help the state’s implementation of it without elaborate checks
The Nobel Prize for economics this year has gone to three scholars, two American citizens and one French-American. It has generated much excitement in India because one of the Americans, Abhijit Banerjee, is of Indian descent, and all three have worked on India. This has happened before. Angus Deaton, the 2015 recipient, and Amartya Sen (1998), had done research on India too.
The difference this year is that the randomized control trials (RCTs) used by the awardees gave their work a sharply prescriptive aspect, following the example of the pharmaceutics field, where a vaccine or medication once validated through an RCT is approved for prescription. Inducted into economics, whether RCTs yield actionable results is a function of study design: the framing of the hypothesis, the composition of the control group, and the context in which the study is done. The last two are especially important because the placebo control in medical research is not so easy to implement in behavioural research. I have a published research paper, with co-author Manish Gupta, in which we establish that the findings in a paper by Duflo and an Indian co-author, Raghbendra Chattopadhyay, are based on an incorrect framing of the hypothesis being tested.
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