Nobel laureate Esther Duflo shares her unique perspective on economics, poverty, and human motivation in a conversation with Adam Grant.
She discusses her unconventional journey into economics, her groundbreaking experiments to combat poverty, and her insights on what truly motivates people.
She also debunks common myths about poverty and discusses how to make meaningful progress towards solving complex societal problems.
Women in Leadership Roles
Duflo’s research on women in leadership roles in India reveals that women are more likely to run for and be elected to office if they have seen other women in leadership roles.
However, societal attitudes towards women in leadership roles still need to change, as voters often have negative impressions of these trailblazing women.
Debunking Misconceptions about Poverty
Duflo’s work focuses on debunking common misconceptions about poverty.
She challenges the idea that all poor people are on the brink of starvation, potential entrepreneurs needing capital, or fundamentally lazy.
Her research provides compelling evidence against these misconceptions, promoting a more nuanced understanding of poverty.
Impact of Winning the Nobel Prize
Winning the Nobel Prize has given Duflo more opportunities to speak and influence policy, but her primary motivation remains the same: to make a difference by solving problems on the ground.
There is pressure to make the most of her increased influence and the importance of taking small steps every day towards solving larger problems.
Fluidity of Beliefs and Attitudes
Duflo highlights the fluidity of beliefs, attitudes, and tastes, arguing that they are influenced by a variety of factors including environment, social norms, and personal behavior.
She suggests that people’s views are not as deeply ingrained as they might seem, and that behavior is more fluid than discourse.
Motivated Beliefs and Behavior Change
The concept of ‘motivated beliefs’, beliefs influenced by a person’s desires or motivations, can be used to encourage behavior change.
Duflo shares an example of a large-scale experiment involving Facebook ads encouraging people not to travel during the holidays due to COVID-19.
The results showed that people were responsive to the ads and changed their behavior, regardless of their political affiliations.
Unconventional Journey into Economics
Esther Duflo’s journey into economics was not a typical one.
Despite initially disliking the subject, she was drawn back to it due to its potential as a tool for societal good.
Her passion for development economics, despite its lack of recognition at the time, was driven by her desire to make a meaningful impact.
Dignity and Job Embeddedness
Duflo emphasizes the importance of dignity and job embeddedness in people’s lives.
She argues that people want more than just money; they want a job that aligns with their values, interests, and skills, and a sense of belonging to a community.
This connection often determines whether they stay in a job.
I didn’t come here to get a great job. I came here to study development economics. – Esther Duflo
Revealed Preference
Duflo discusses the concept of ‘revealed preference’, which suggests that people often discover their own preferences through their actions.
She argues that people are often confused about their own preferences and those of others, and that observing their own behavior can help clarify these preferences.
Economists as Plumbers
Duflo suggests that economists should be like plumbers, willing to try different approaches, fix problems as they arise, and learn from their mistakes.
Predicting human behavior is not as straightforward as predicting physical phenomena due to the complexity and unpredictability of human behavior.
This disbelief that others are much more sensitive to financial incentive than I am is pretty frequent and I think the belief in the just world is definitely a part of it. – Esther Duflo
Ground-Level Approach
Being close to the ground and understanding people’s views is more effective when designing and implementing programs.
This approach is more effective than trying to come up with universal laws of behavior.
Humility and willingness to learn from mistakes are key.
Logistics of Large-Scale Policies
Implementing large-scale policy changes in developing countries is challenging.
While it’s important to think about big questions, it’s also crucial to focus on the logistical details of implementing these policies.
This is referred to as the ‘plumbing’ part of the work.
Challenging Assumptions about Labor Supply
Duflo challenges the assumption that cash transfers decrease people’s motivation to work.
Citing several studies, she argues that these transfers often do not impact the number of hours people work.
She also disputes the notion that people are lazy if they do not want to move for a job, highlighting the importance of social networks and a sense of belonging.
