Abhijit Banerjee in a joint interview with Esther Duflo by Philanthropy Action:
There seems to be a real axiom out there that says you can put people in charge of their own destiny and walk away. Yet when you think about it, these people are under enormous stress in every respect. Their child is sick, their parents are dying, they have no income. Every day they have to go out and find work. To expect them to be able to have the leisure or perspective to always be able to take charge of their larger destiny – to operate the political systems and find opportunities? I wouldn’t say that is the biggest wrong idea, but it is just a very untested idea.I suspect that in the aggregate it is wrong. Meaning, that if you picked one or two things that you said people have to be involved in, they would probably do a pretty good job. But if you think of the number of things we are beginning to expect people to take care of themselves it quickly gets overwhelming. We want them to be on the forest maintenance committee, the environment maintenance committee, the water committee, the education committee, the village health committee. They have to take a microcredit loan and pay that down and start a small business, at the same time that they have to make sure the children are getting homework help....It seems to me part of the issue is that the expectations are also set too high. If the goal of microfinance is to change people’s lives it will have been deemed already to be a failure, despite the fact that results are showing it is doing some reasonably good things. I think this comes from a particular development mindset, also untested, which is that all that is needed is one big thing to happen and things just...explode. I don’t think there is any evidence that things ever happened that way. ...So, if microfinance suddenly doesn’t make all babies do calculus by the age of five, it is deemed a failure. I think if we just accept that in the end a few things work and somehow that gives people the spirit or the enthusiasm or the hope to act a bit more and enable those things to accumulate on their own.
Most popular reports on randomized trials, whether of the impacts of microcredit or paying parents to immunize their kids, focus on one study at a time and close with the reminder that it is just one study, in one place, at one time. But as more studies are done, it becomes possible to make important generalizations about what works best and what doesn't. Interviewers Tim Ogden and Laura Starita do a good job of drawing out Banerjee and Duflo on this theme.Actually my favorite lines are the interviewers', because they nail something I've been thinking about:
We see the exact same dynamic happening between donors and NGOs. The donor won’t give unless the NGO sets this unrealistic expectation, but then the donor becomes a cynic because the unrealistic expectation that he forced the NGO to accept fails to have any impact.
