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The New Development Economics: We Shall Experiment, but How Shall We Learn?

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  • Rodrik, Dani

    (Harvard U)

Abstract

Development economics is split between macro-development economists--who focus on economic growth, international trade, and fiscal/macro policies--and micro-development economists--who study microfinance, education, health, and other social programs. Recently there has been substantial convergence in the policy mindset exhibited by micro evaluation enthusiasts, on the one hand, and growth diagnosticians, on the other. At the same time, the randomized evaluation revolution has led to an accentuation of the methodological divergence between the two camps. Overcoming the split requires changes on both sides. Macro-development economists need to recognize the distinct advantages of the experimental approach and adopt the policy mindset of the randomized evaluation enthusiasts. Micro-development economists, for their part, have to recognize that the utility of randomized evaluations is restricted by the narrow and limited scope of their application. As the Chinese example illustrates, extending the experimental mindset to the domain of economy-wide reforms is not just possible, it has already been practiced with resounding success in the most important development experience of our generation.

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Paper provided by Harvard University, John F. Kennedy School of Government in its series Working Paper Series with number rwp08-055.

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Date of creation: Oct 2008
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Handle: RePEc:ecl:harjfk:rwp08-055

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  1. Mukand, Sharun & Rodrik, Dani, 2002. "In Search of the Holy Grail: Policy Convergence, Experimentation and Economic Performance," Working Paper Series rwp02-027, Harvard University, John F. Kennedy School of Government.
  2. Jessica Cohen & Pascaline Dupas, 2008. "Free Distribution or Cost-Sharing? Evidence from a Malaria Prevention Experiment," NBER Working Papers 14406, National Bureau of Economic Research, Inc.
  3. Robert T. Jensen & Nolan H. Miller, 2008. "Giffen Behavior and Subsistence Consumption," American Economic Review, American Economic Association, vol. 98(4), pages 1553-77, September.
  4. Banerjee, Abhijit & Bardhan, Pranab & Basu, Kaushik, 2005. "New Directions in Development Economics: Theory or Empirics? A Symposium in Economic and Political Weekly," Working Papers 127128, Cornell University, Department of Applied Economics and Management.
  5. Ricardo Hausmann & Lant Pritchett & Dani Rodrik, 2004. "Growth Accelerations," NBER Working Papers 10566, National Bureau of Economic Research, Inc.
  6. Martin Ravallion, 2009. "Evaluation in the Practice of Development," World Bank Research Observer, World Bank Group, vol. 24(1), pages 29-53, March.
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