November 20, 2019 Featured

PES University Bangalore had organized a Symposium on Exploring Nobel Prized Thoughts: Musings on the 2019 Economics Nobel Prize


The 2019 Nobel Prize itself has specially been gratifying. One of the winners was born in India. Abhijit Banerjee and Esther Duflo of MIT and Michael Kremer of Harvard won the coveted prize for their distinctive contribution in the use of experimental methods to learn about the effectiveness of small-scale policy interventions aimed at helping improve the lives of some of the world’s poorest citizens. The experimental method applied by the three winners is called a Randomized Controlled Trial, or RCT. The Nobel Prize appropriately recognizes both the winners’ use of a powerful research technique and their application of that technique to some of the world’s most pressing policy problems. The Welcome Address was given by Dr. Vijay Kumar, Dean, Department of Management Studies, PES University Bangalore. Eminent speakers from esteemed organizations presented their views on the theme. The gist of the talks is mentioned below: Ritwik Banerjee, UC Berkeley Fulbright-Nehru Visiting Scholar, Associate Professor, Indian Institute of Management, Bangalore initiated on Randomized Controlled Trial: The New Standard in Development Economics. He mentioned the need for RCT in developmental economics. He explained about the causal determinates, causal association and causal relations. He further helped in understanding the mechanics of RCTs with examples such as the Deworming experiment by Mighel and Kremer and the Immunization experiment by Banerjee, Duflo, Glennester and Kothari. He also touched upon the limitations of RCTs and how the external validity plays a role in its drawback. R. Ramakumar, Professor, Tata Institute of Social Sciences, Mumbai addressed the topic of What ails Randomized Controlled Trial? He laid emphasis on how RCT contradicts its own definition of randomness. He also called the Randomized Controlled Trail a problematic and ahistoric as it disregards the pre-scientific baggage with which the experiments are conducted. He questioned “Is being random equivalent to being unbiased?” He also questioned RCT being regarded as the gold standard of developmental economics. He further suggested that the introduction of stratification will help in making RCT a right choice but the rule book of RCT considers prior information as lethal. Sowmya Dhanaraj, Associate Professor, Madras School of Economics, Chennai elaborated on Running Randomized Evaluations: An Indian Experience. She spoke about the Indian Experience of the RCT implementation. She explained how the experimental study is classified. She mentioned that RCT holds good for evidence based policies and also explained cycle of evidence in understanding policy making. She also talked about the friction between the policy makers and the reaction of the other sections affected by the policy. Surbhi Kesar, Research Fellow, Azim Premji University Bangalore highlighted the aspect of Randomized Controlled Trials: Implications for the field of Development Economics. She talked about the problematic pain points of RCT. She mentioned that there’s a trade-off between precision and unbiased in the design of the experiment in RCT. She also spoke about the normative issue and the desirability of an intervention. She added that RCT is a borrowed technique from life sciences. V. Sridhar, Associate Editor, Frontline explained the topic of Randomized Controlled Trial: Understanding and Misunderstanding. He said that RCT has clouded out other ways to address developmental economics. Also, RCT has become more of a fashion for students to have in their CV to further their doctoral ambitions. He emphasized that RCT works in averages while a country like India which is highly stratified, the data between the averages will suffer from a lot of variations. He mentioned that RCT being a flavor of the day is a serious problem. The audience comprised of industry professionals, academicians and students. They well appreciated the overall concept, theme and presentations done by all the esteemed speakers.