Transcripts For BBCNEWS HARDtalk 20240713

Now on bbc news, its hardtalk. Hello and welcome to hard rock. I am shaun ley. We use random trials to test whether medicines make a difference. Why not use the same method to find effective treatments for poverty . The experimental trials in africa and india run by professor esther duflo and two colleagues have won them the nobel prize for economics. Among theirfindings food aid isnt helping the poor, and the poorest kids dont need more books, they need more time. A fashionable idea wins the nobel prize, but is this really a story of failure . Of economists to predict the financial crisis, and of economics to offer Big Solutions . Professor esther duflo, welcome to hardtalk. In awarding the prize to you and your fellow economists, Abhijit Banerjee and michael kremer, the Nobel Committee prays your experimental approach to alleviating global poverty. How would you explain what you do . So the idea is very simple. So first of all, you ta ke very simple. So first of all, you take a big problem, like how are we going to eradicate poverty, and break it into manageable pieces, pieces that. You know, smaller questions, but questions that admit rigourous answers. And then once you have one of those questions, you deploy something which is very much like a randomised controlled trial in medicine to test one approach against the other. So to give you an example, suppose that you want to know how to motivate parents to take their kids to be immunised. You could set up a randomised controlled trial, where in some villages, randomly chosen, you work with members of the community that i going to mobilise parents to get their kids immunised. In other communities, you send reminder text messages, and in yet another set of communities, you provide small incentives, say in the form of ceuphone incentives, say in the form of cellphone minutes, paid to parents. And then you can do these things together or in combination, because you have randomly chosen the villages, there is nothing different about them. So you can track the immunisation rates in the different types of villages, and see where it is higher. And in the places where it is higher is the intervention thatis it is higher is the intervention that is the most effective. In other words, see what works and what doesnt. Abhijit banerjee, who is your partner as well as your fellow Nobel Prize Winner, said initially people thought of this is kind of a loony agenda. People told us it is not how you learn about anything, because it is too small, to local. How did you overcome that scepticism . Little by little. You can think of each of these individual projects as one. , and then together the dots start forming pictures. And initially, maybe the sceptic said, you know, it might not replicate, what you find in india might not be valid in kenya, and what you find in tenure will surely not be valid in the uk. And we said yes, possibly, but the only way to find out is to try. And multiply the number of trials, and try to understand what generalises, what doesnt, and also when something works out, why it works out or weighed doesnt. And progressively, this has really become a movement. We really take this prize is not as recognising the work of all three of us, but recognising the work of hundreds of people, researchers, a network. This is jpal, the thing you founded back in 2003. I think it has about 100 researchers. Exactly, jpal itself has 400 researchers and together they have completed 1000 projects. So this is a large number of projects, and there are people who are not injpal who are using the same approach. So this has demonstrated the power of this technique, of this tool, much more than any other single project could have. Just after the award was announced, you said it was a not so much like hard science, molech engineering plumbing, breaking the big problem into manageable chunks and solving them through accommodation of intuition, trial and error, and so on. I suppose it is an interesting analogy, but the argument may be made that the plumber can certainly remove the blockage, but the plumber cant ensure you are getting your fair share of the water, of the basic resource. Isnt that the danger of the approach, that you are kind of seeing the minute but actually you are not solving the fundamental problems that lie behind it . This could be reversed, which is that you could be reversed, which is that you could have the very best Engineering Solution in place, and the most modern water technique, water system, in your city, but if the plumbing is not there, nobody is going to get the water. So i dont think we are claiming that all economists need to do is running randomised controlled trials and worrying about the plumbing. All we are claiming is that some economists need to do some plumbing some of the time. And i think by us winning the nobel prize doesnt mean everybody else should stop thinking about the big, hard questions and should stop thinking about engineering and hard science, but that that is also something that has its place in the fight against poverty and in our thinking about Economic Policy more generally. I want to come back to that, if i may. Buti generally. I want to come back to that, if i may. But ijust wanted to pick up on the very particular area that you have been working on now for a couple of decades, which is trying to work with the poorest communities, particularly in india and africa. Has enough attention, do you think, traditionally been paid by economists to the poor . |j you think, traditionally been paid by economists to the poor . I think development economics, as early as 15, 20 Years Development economics, as early as 15,20 years ago, development economics, as early as 15, 20 years ago, used to be not really a fashionable subject. And i think one important thing that my c0 think one important thing that my co winners did, michael and Abhijit Banerjee, is to put it back on the map is something that many people could do. There always has been Development Economists doing great work, but it had been a little bit on the margins sometimes. Something that very few people decided to do. Fortu nately, that very few people decided to do. Fortunately, that is not the case anymore. I think that movement around mass controlled randomised controlled trials, has become a movement of many people deciding to Study Development economics and the problem of the poor. And that of course, what else would you be interested in . Once you start thinking about the problem of a poor mother in a village in india, and what you could do to make it better, its a little bit difficult to get focused on something else. Give us some examples of what you might call unexpected findings from your experiments, where you have kind of given new insights. So, to give you an example, i studied many years ago the role of women in politics, and in particular of woman mayors. So there are very few women in politics in india, and infact there are very few women in politics in india, and in fact everywhere in the well, pretty much, in the absence of quota, people dont tend to elect women. In india in 1993 made the bold move of deciding that one third of the villages have to elect a woman as the mare. And there was a ton of pushback on this policy mayor. Saying that women are not ready, they are not capable, they are not leaders, they dont have experience, they dont have charisma, the husband is going to run the show, and so on and so forth. I didnt have a strong view on which way it was going to go, but i thought this has to be investigated. And the way that india did it, they kind of ran a massive randomised controlled trial without knowing it, because they randomly selected every election which places need to elect woman. So what me and my indian co author did as we collected data, because the experiment had been run, on what women do and what men do. And we learned many important and unexpected things. And the first one is that women are extremely effective leaders, and they are doing very different things. So they are not at all from their husbands, even these women who seem shy and retiring and wont speak, once they are in power, they actually run the show, and they are very powerful. Eleanor 0strom was the first woman s economics lawyer, or the second. Do you think more women has affected the kinds of subject study . Has it left some of the subjects out of the equation . Most definitely, notjust at the top of the profession but all through the profession. U nfortu nately not through the profession. Unfortunately not enough women decide to study economics, not enough undergraduate students pick economics as a field. Among them, not enough say in the Phd Programme and then continue to become researchers. And i think this is very damaging, because it really has an impact on what we study, because women and men have slightly different centres of interest. By the way, it is notjust women, it is also minorities, who are also underrepresented. In fact, also minorities, who are also underrepresented. Infact, even more. And that deprives us as a field. Economics is a social science, we should have a different perspective. You yourself have criticised the way we attempt to tackle poverty through economic theories, that simple problems beget simple solutions, left us with the detritus of instant miracles that prove less than miraculous. Isnt your approach also guilty of that as well . All these different little examples, experiment that might have worked in one place, everyone thinks thatis worked in one place, everyone thinks that is going to be a solution, then discovered it doesnt apply elsewhere . Well, that is the question, isnt it . We are not claiming to have any silver bullets, but we are looking, if you will, for the silver pellets. You know, many Little Things that might work. We never. Little things that might work. We never. 0ne experiment is not going to tell you, once you have done one experiment somewhere, that you have to scale up that particular approach everywhere in the World Without modification or without further research. The way that it typically works is each of think of each of these projects has one little dot, one little data point, that helps us understand one aspect of the problem. Before scaling up, projects are replicated, and you can see whether the lessons carry out. The same thing for finding out that something is not effective, actually. Let me put the criticism that has been made of this approach, and in some of last year 15 economists including three previous winners of the nobel prize for economics is that the real problem with this craze, as they call it, is that it narrows our focus to micro interventions. It tends to ignore the broader macroeconomic political and institutional drivers of impoverishment and underdevelopment. Would you accept that that is a fair criticism . The question is what are you going to do about those . 0nce you going to do about those . 0nce you have said that there are big macro problems, big institutional problems, then what . Nothing. So the question is, you want to take. For example, take institutions. The quality of institutions generate. Has a huge impact on the quality of life of people. But once you have said that, how do you improve institutions . Is going to be through a set of steps. For example, you know that democracy is better than non democracy in expressing the will of the people. 0nce non democracy in expressing the will of the people. Once you have said that, how do you actually organise a democracy . How do people vote . Organise a democracy . How do people vote . What do you need to put in front of people to make the right decision . What are the right. You know, even as plumbing, what are the right way to count peoples boats, et cetera . Right way to count peoples boats, et cetera . But i can see why, for a lot of particular policy makers who have to wrestle with the pressures of competing demands for budgets, your approach is very attractive, because it basically doesnt challenge the fundamentals of the way the system is organised, and what these critic saying is it is all very well to break big problems into manageable chunks, as you put it, try to solve them pragmatically, but that may disguise a bigger, more fundamental problem, the system we have devised for distributing wealth, that creates this inequality stop because in a sense, your work is about outcomes, but it doesnt necessarily deal with why we get those outcomes. So, first of all, i will take exception to that, which is that in every study that we do, it usually calls for a follow up study that can help us get into the why. So i think we get to much deeper understanding of the why then big thought about good institutions are good. 0nce big thought about good institutions are good. Once you have said that, you know, once you have said that you know, once you have said that you have to get into what is a good institutions. 0ne you have to get into what is a good institutions. One show, but you have been very candid about this. Back in 2010 the new yorker quoted a ted presentation you gave in california where you explained over several decades aid for africa had risen sharply, but the gdp per capita had not. And then you tell your audience, we have no idea. Not any better than the mediaeval doctors and their leeches. Yes, and the point is that in order to find out, you have to get to get to the details. You cannot even answer the question of whether it is good or bad, a market is good or bad, or democracy is good or bad, without being a bit more specific in the question. The attitude of saying, oh well, if you can only answer the small questions, it could make the life of people a little bit better, because of the system, to me, surprisingly, from a Nobel Prize Winner in economics, we tend to not be extremist, to me is a bit like a marxist attitude, which is, you have to make things as bad as you can to create revolution. So in that sense iam not like create revolution. So in that sense i am not like that. I am much more ofa i am not like that. I am much more of a pragmatic person. I am not going to kind of collude with. Lets let the system explode under its own pressure. But dont you colluding with the system, if we do these local things which make things betterfor the individuals, thats great that individuals, thats great that individuals who are helping the point of randomised trials is, there is no rational basis on who you choose, a medical drug, the other people who receive the placebo, they are not getting the medical help even though they may need it is great. There are good systems with outcomes that are very bad and i think when outcomes are very bad and good systems, that makes fragile the good systems, that makes fragile the good systems, that makes fragile the good systems and they are more likely to collapse so a lot of the work im doing in india is in india which is generally a very well functioning, worlds biggest democracy where there is a lot of progress to be made. In the uk, so many things are not working for the poorfor many things are not working for the poor for the many things are not working for the poorfor the middle class, because they are not very well organised so that creates under that and engage in is that creates under that and engage inisa that creates under that and engage in is a reasonably good system we have and puts people in the situation we have now in the uk so i think this idea that you cannot do anything meaningful without changing the system, its not for me. Do you accept, though, in part, the appeal of your approach with its kind of demonstrable outcomes, has been a reflection of a kind of sense that perhaps the bigger world of economics, the world of macroeconomics has failed or has at least failed to warn us, to caution us, to cause us to change behaviour ina way us, to cause us to change behaviour in a way that might have prevented things like the financial crisis of ten yea rs things like the financial crisis of ten years ago. The queen famously said, why didnt anyone see this coming when she went to visit the London School of economics and nobody could tell her. That is certainly not been a bright moment for economics. I think economists are not very good or even quite terrible at forecasting. The economist ran an article a few years ago, the aim of detection are no better than taking the current rate of growth and keeping it at and predicting a constant rate of growth so it is better than that. The problem is they are usually expected to do that because they are bad at it, that really harms the trust in economists so we need to communicate to the public that thats not the only thing economics is about, its also about trying to understand behaviour in a slightly more detailed way, a more empirical way, more close to the ground and give Practical Solutions to concrete problem that people can understand, such as, how do you get kids to learn in school or how do you most effectively help someone find a job after theyve lost theirs. You cant be accused of kind of giving up on your profession because your book, good economics for hard times, makes a case for why economics and economists are still needed but in it, youre right, we seem to be back ina it, youre right, we seem to be back in a dickensian world of hard times with the haves facing off against increasingly alienate have nots with no resolution in sight. Questions of economics and Economic Policy are central to the present crisis. I suppose the kind of key example of that really is, is the level of inequality that means even the richest countries, the 400 richest households in the 19 50s in the United States paid 70 17 of the world, now it is 23 . The poorest households, 1950, 16 of their wealth in tax, 2018, 20 6 . These figures seem so striking and astonishing yet they dont seem to provoke much real comment. Outside the world of economics. I think at the world of economics. I think at the moment, they do, thanks to the world of Emmanuel Saez and gabrielle sugarman. I think they are in the public eye and that is very important and public eye and that is very importantandi public eye and that is very important and i think the work is going to contribute to a thinking of the tax systems and in particular tax on the rich that people are, the western government have progressively given up on. What we think needs to be done in complement to this approach is giving the public a much clearer idea of, suppose you could raise taxes on the witch, whether you would do it because with the increasing inequality and deterioration of Living Conditions for the vast majority of people in the western world, combined with this huge increase in inequality, there has been a crisis of legitimacy of the government. The commonest are the least trusted in their own field of expertise in the uk, and yougov, 25 of people trusted them. The only people who are less trusted than economists are politicians and when you are in a situation where you have to face issues that are at heart policy, Economic Policy issues like inequality or climate change, for example, the idea that these are economists, not policymakers, are able to keep a voice, a trusted voice, is very depressing and we hope to hold onto the hope that we could get back to it and get back to a reasonable discourse, so that as a society we can start addressing this issue. But when your project to increase vaccination rates in india did improve them significantly from single figures, but still not a majority, i should set about this, you said some policies dont work and it isnt clear why they dont work on the way you expected but you said you prefer your approach to the one that says the view that its a big conspiracy against the four, name your favourite enemy, capitalism, corruption, our approach use said is easier. Warren buffett was a wealthy man who has no reason to worry about his own income as there is an in and enemy, there is an enemy and it is an enemy that is an enemy and it is an enemy that is paying preying on the poor. There is class warfare, but its my class, the rich class, that is making warand we class, the rich class, that is making war and we are winning. Is it your obligation is in condiments if your obligation is in condiments if you see evidence of this call it out . I do think it is very powerful, the war, and Warren Buffett is not the war, and Warren Buffett is not the only one to use it. The populist movement have gained a lot of ground by putting them self as the leaders of the downtrodden as the downtrodden being the footsoldiers andi downtrodden being the footsoldiers and i do think it might be a good idea to take ownership again of that image and say, if youve lost your job because youve been replaced by a robot or yourjob was outsourced somewhere, the factory that produced furniture has now been shut down because the furniture is made in china, you are, in a way, a veteran of not well that is fought specifically against you but a vetera n specifically against you but a veteran of an economic disruption world and we should not look at you with suspicion because you need welfare, we should not look at you asa welfare, we should not look at you as a sponge with trying to take advantage of the system, we should not look at you as a loser, we should look at you as a hero and someone that we need to meaningfully help. So this is maybe what we are adding ina help. So this is maybe what we are adding in a place where not only is it important to raise revenue and inequality by raising taxes at the top but you need to show people what you are going to do with it that is going to help them directly. And you need to really change both the rhetoric and the programmes themselves to have a clear one that in the globalised world in which we live, and with the advent of Artificial Intelligence and privatisation of a lot of the workforce, people are constantly faced with disruptions in their life and they are not, they are not as equipped to deal with this disruption as economists and policymakers like to think and therefore we need to be there to help them out and help them out and turn their lives around to something else. At the end of the book, you wish your call to action and you conclude by saying its for all of us conclude by saying its for all of us to take responsibility, economics is too important to be left to economists. I hesitate to say this given an pointed out that survey shows that only one group of people is less respected than economists in the uk, and it is politicians, but would you consider entering politics . President macron was among your biggest fans, and is interested in solutions. Could you not be one of like one of those indian mayors who took office . When i was 20, i considered not entering electoral politics but becoming a Civil Servant because i wanted to make a difference in the world and what stop me at the time is, i didnt wa nt to stop me at the time is, i didnt want to be in a situation where i had to make a lot of decisions under pressure, knowing well that this is not my might not be the best decisions. Ifound not my might not be the best decisions. I found the not my might not be the best decisions. Ifound the idea uncomfortable, i still do. Decisions. Ifound the idea uncomfortable, istill do. I decisions. Ifound the idea uncomfortable, i still do. I think i have the best job uncomfortable, i still do. I think i have the bestjob in the world. Which is the ability to think deeply about problems and take my time away from any electoral pressures which are very real and at the same time, whenever there is a space for an opening or a conversation on politics, are people willing to listen to me. So i think im going to stay where i am. Professor esther duflo, thank you for being with us on hardtalk. Thank you so much. Hello there. Parts of england and wales look extremely wet on thursday with the risk of localised flooding in places and the risk of some travel disruption, all courtesy of this new area of low pressure which is going to park itself across the uk and this very slow moving front will bring some very wet conditions through central portions of the uk. Early on thursday, that rain band will be slowly spreading its way northwards so some places quite wet. Blustery showers across the southwest and some showers across scotland which will be wintry over the high ground. A little bit of sunshine around and not quite as cold a start as what we have seen the last few nights because we have cloud around. But through thursday morning, that rain band will almost grind to a halt across parts of north wales, the north midlands, Northern England and the rain will be heavy and persistent at times. Like i said, producing some localised flooding and travel disruption in places and well also have quite a keen east north east wind, making it feel pretty raw so not very pleasant conditions throughout the day on thursday here. To the north of it, bright, probably the best sunshine for western scotland. A few showers which will be wintry on the hill but quite blustery here and some heavy, maybe thundery showers across southern and south western parts of england and it will be quite blustery here, too. But into the midlands and the south east we should see some sunshine, slightly lighter winds. It will be a chilly day wherever you are, just about 10 degrees across the south and single figure values further north. And like i mentioned, feeling really chilly underneath that cloud and rain. Through thursday night, a slow improvement. That weather front with the band of rain continues to ease down and push towards the south and east so it will be a dry and chilly night across many northern and southern areas but where you have the cloud, not quite as cold, ranging from 2 6 degrees there. The pressure chart, as we head into friday, shows this area of low pressure slipping off into the near continent. A bit of a hand back across the eastern side of the country with this weather front which will continue to bring a fair amount of cloud and one or two showers, but a ridge of High Pressure builds in across the north and west, so here, after a chilly start, it should be a fine day with plenty of sunshine around. Much of the country should see a bit of sunshine apart from the eastern side of england where its going to be another chilly day. As we had through friday night, eventually well see the cloud and the rain in the south east clear away, its going to be a cold night under clear skies with a widespread frost. The next weather front will arrive across the west, so not quite as cold for Northern Ireland as it will be across much of britain. Into saturday, a cold, frosty start for many but that rain will spill in from the west to many areas and then on sunday, its a gradual improvement with some sunshine developing. This is the briefing im sally bundock. Our top story us prosecutors charge two former twitter employees with spying for saudi arabia. Its claimed they targeted critics of the saudi government and royal family. With the impeachment inquiry hotting up President Trump lashes out at the democrats accusing them of staging show trials. Lebanons mass protests continue but what are they about . Three young people tell us their dreams for the future. And going supersonic with the bloodhound, the British Mission to break the world land speed record. In business, betting the farm