Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty

First, the poor often lack critical pieces of information and believe things that are not true.

ideology, ignorance, and inertia—the three I’s—on the part of the expert, the aid worker, or the local policy maker, often explain why policies fail and why aid does not have the effect it should.

Effective social safety nets (such as health insurance or old age pensions) or even the kind of financial development that enables people to profitably save for retirement could lead to a substantial reduction in fertility and perhaps also less discrimination against girls.

Girls in Kenya know perfectly well that unprotected sex leads to pregnancy. But if they think that the prospective father will feel obliged to take care of them once they give birth to his child, getting pregnant may not be such a bad thing after all. In fact, for the girls who cannot afford a school uniform and therefore cannot stay in school, hav

ideology, ignorance, and inertia—the

Finally, expectations about what people are able or unable to do all too often end up turning into self-fulfilling prophecies.

Good economic institutions will encourage citizens to invest, accumulate, and develop new technologies, as a result of which society will prosper.

Details matter.

A combination of unrealistic goals, unnecessarily pessimistic expectations, and the wrong incentives for teachers contributes to ensure that education systems in developing countries fail their two main tasks: giving everyone a sound basic set of skills, and identifying talent.