summary ofGood Economics for Hard TimesBook by Abhijit V. Banerjee, PhD, Esther Duflo, PhD

first KEY POINT

We are not doing enough

The public disagrees on immigration, trade, growth, inequality, and the environment. The world is becoming more polarized. In the US, for example, eighty-one percent of those who identify with one party have a negative opinion of the others. Sixty-one percent of Democrats view Republicans as racists, sexists, or bigots. Fifty-four percent of Republicans call Democrats spiteful. A third of Americans wouldn’t even endorse marriage across party lines.People are not listening to one another because of the polarization that politicians peddle. Also, there is no consensus on the various social problems and how to fix them.

It behooves social scientists to offer facts and interpretations of facts that will help mediate these divides, hoping that each side will understand what the other is saying. That way, they can arrive at some reasonable disagreement if a consensus is impossible.The present crisis revolves around economic policy issues. What should be the focus of the West? Should it be growth since we are already affluent? Or should it be on the increasing inequality? Can we blame the present situation on international trade? Should we find another manufacturing hub to replace China? Is migration the problem it is painted to be? Should we be as concerned about AI as we are about low-skilled migration?Virtually all economists have an opinion on these topics. Unfortunately, people hardly trust economists. What undermines trust in economists is that there are plenty of lousy economics around. Academic economists do not have time to explain their conclusions for ordinary people to understand.This summary boldly attempts to provide good economics in plain language, hoping that we will apply these principles to hard times.