In the last two months, I have hit a lucky streak with books—I read two gems. Before the flood was a drought brought upon by my foray in business strategy books like 7 powers and High Output Management. Having read five of them, I recommend substituting business books with freely available summaries. Don’t read 200 pages when a mere two will do.
The first of the gems is Poor Economics by Banerjee and Duflo. Banerjee and Duflo have a talent for seeing the obvious, the gumption to ponder over it, and learn. The result is a terrific book. They notice the epidemic of unfinished buildings on the outskirts of most developing world cities, the chafing fact that poor parents call some of their kids stupid with them in the room, that poor people don’t fertilize their fields or get cheaper loans when they can.
Banerjee and Duflo also give hard data. With the data, they put the lie to the idea that the poor are “natural” entrepreneurs—they are not; they open up small undifferentiated unscalable businesses because often they don’t have access to full-time jobs. Not satisfied with demolishing one misunderstanding, they go after another—the idea that most poor don’t have the money to buy enough food. They show that the world is thankfully rich enough in 2011 that many poor people can buy a full complement of calories. But many poor people choose not to, preferring more expensive tastier calories to a full quota of calories.
Poor Economics is a well-written book by people who care about getting it right. Read it to learn how to learn and how to see the obvious. Recommended.
The second book is the provocatively titled The Wisdom of the Whores by Elizabeth Pisani. Elizabeth worked as a journalist for 12 years before getting a Master’s degree in public health and working on AIDS. The book is about her years as an AIDS researcher.
Elizabeth is able to think like an outsider while working inside the system. This ability is probably a consequence of her years as a journalist. The upshot is that Elizabeth writes with great objectivity.
Sample a small treat. In the 1990s, there were a slew of news articles that warned about an impending AIDS crisis, especially in East Asian countries like Thailand, where prostitution was rife. But today you don’t hear much about AIDS. Is it that the news media moved on prematurely or that the world invested wisely and averted the crisis? It is plausibly a bit of both. But there is another reason—we likely just got it wrong.
In the heydays of AIDS activism, many earnest people joined AIDS organizations. Many of them believed that AIDS was the big crisis of their time. These people were so convinced of the point that they were insufficiently critical about numbers that were consistent with their priors. Many also worked hard to oversell the numbers.
One can be cynical about the people. And there is some reason to be. Careerism is rife among NGOs as everywhere else. But if you step back, it is a tragedy. Many of the people working on AIDS in the 1990s were genuinely interested in human welfare, often taking a pay cut to work at non-profit organizations. But being convinced about the enormity prevented them from working on getting the numbers right and from clearly thinking about the opportunity costs—the same dollars could be spent on maternal health or malaria or something else to greater effect.
I have depressed you enough so I will end here.
I am looking forward to coming back to you with more soon.