• Nobel-winning economist Michael Kremer to join department faculty as University Professor

     

    Photo by Jon Chase/Harvard University

    Photo by Jon Chase/Harvard University

    Nobel Prize-winning economist Michael Kremer has been appointed University Professor at the University of Chicago and will join our department faculty.

    A pioneer in development economics who has shaped the discipline through the use of field experiments to inform economic models, policy and program development, Kremer shared the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel in 2019. He has been most recently at Harvard University, where he serves as the Gates Professor of Developing Societies in the Department of Economics.

    Kremer’s appointment at UChicago will be effective on Sept. 1. He also will hold a secondary appointment at the Harris School of Public Policy.

    “Michael is a scholar of extraordinary vision and accomplishment. His research has had an enormous influence on his field, and has been impactful in informing public policy in developing countries,” said Ka Yee C. Lee, provost and the David Lee Shillinglaw Distinguished Service Professor of Chemistry. “We are delighted to welcome Michael to the University of Chicago. The range of his research will undoubtedly lead to collaborations across divisions and schools.”

    University Professors are among those recruited at a senior level from outside the University, and are selected for internationally recognized eminence in their fields as well as for their potential for high impact across the University. Kremer will become the 23rd person to hold a University Professorship, and the 10th active faculty member holding that title.

    “The University of Chicago’s commitment to expanding research on development economics is an exceptional opportunity,” Kremer said. “The work ahead will develop new knowledge on ways to address global poverty and ultimately to do good for the world.

    Kremer was among the first economists to evaluate interventions in developing countries through randomized control trials. In 1998, he evaluated a project on deworming in Kenya. By comparing schools that had already been phased into treatment for intestinal worms with those that had not yet been phased into the program, he and his collaborators found that the program reduced student absenteeism by a quarter—and even reduced transmission of the disease to neighboring schools. Subsequent work also found that deworming had long-run impacts, leading to higher living standards 20 years later.

    “Michael’s research and its resulting policy impacts in economic development, health, education and technological innovation has been transformative at a global scale,” said Amanda Woodward, dean of the Division of the Social Sciences and the William S. Gray Distinguished Service Professor of Psychology. “We look forward to the next revolutionary phases of Michael’s work. He will be a foundational force for the future of Griffin Economics as well as for the broad community of economists at the University of Chicago.”

    Through the nonprofit organization Evidence Action and its private sector and government partners, Kremer’s work has now helped provide free deworming treatments to 280 million children. The World Health Organization recommends large-scale deworming as the most cost-effective way to improve children’s health and nutrition.

    “All of Michael’s work is grounded in theory and built around a coherent set of ideas interrogating what we can learn from economics,” said Rob Shimer, chair of the Kenneth C. Griffin Department of Economics and the Alvin H. Baum Professor in Economics. “His extraordinary contributions to the field of economics and to improving human welfare are testament to the power of his methodological innovations.”

    In addition to that research, Kremer helped develop the advance market commitment, proposing the idea of a contract that would guarantee that if firms developed vaccines for diseases affecting the developing world meeting certain technological specifications, donors would help cover the cost of purchasing the product. Such commitments have stimulated private investment in vaccine research and the distribution of vaccines for diseases in the developing world. A $1.5 billion commitment by a consortium of donors led to the development and distribution of vaccines covering the strains of pneumococcal diseases common in the developing world, saving an estimated 700,000 lives.

    “Michael’s landmark work has not only advanced the field but has had enormous real-world impact,” said Katherine Baicker, dean and the Emmett Dedmon Professor at the Harris School of Public Policy. “His work has resulted in billions of dollars being devoted towards malaria and pneumococcal vaccines focused on the strains prevalent in developing countries. Few economists have saved so many lives around the world.”

    While changes in broad-scale government programs have long provided economists with natural experiments to inform their models, Kremer and his colleagues developed an iterative strategy that engages—and in some instances, founds—NGOs to deliver social programs that implement and test economic ideas. This approach can reveal the causal forces at play in economic systems, shedding light where observational data cannot. It also offers a proving ground for developing and perfecting effective policies and programs.

    At UChicago, Kremer will lead a new Development Innovation Lab, an initiative that will sit within the Becker Friedman Institute for Economics.

    “I am excited to join the University of Chicago, with its storied tradition of pioneering economics research,” Kremer said. “The new lab will use the tools of economics to develop innovations of practical use for developing countries. By bringing together experts in different fields and working closely with nonprofit organizations, firms and governments in the developing world, we can simultaneously advance knowledge and generate solutions to development challenges which can reach hundreds of millions of people.”

    “Michael’s work simultaneously pushes out the frontier of understanding and has had enormous and lasting impacts on people’s well-being,” said Michael Greenstone, director of the Becker Friedman Institute and the Milton Friedman Distinguished Service Professor in Economics. “He is the perfect person to lead the Development Innovation Lab at BFI, and I know he will catalyze the terrific development economics here into even greater heights, with the ultimate beneficiaries being the field of economics and the world.”

    Kremer is the author of more than 120 academic articles and book chapters. He is a fellow of the American Academy of Arts and Sciences and a 1997 recipient of a MacArthur Fellowship. He has won awards for his work on health economics, agricultural economics and on Latin America.

    Kremer earned his Ph.D. in economics from Harvard University in 1992. He was a visiting assistant professor at the University of Chicago in Spring Quarter 1993. Prior to his appointment at Harvard, he was a member of the faculty at the Massachusetts Institute of Technology from 1993 to 1999.

    For more information, please see https://news.uchicago.edu/story/nobel-winning-economist-michael-kremer-join-uchicago-faculty-university-professor.

     

  • Prof. Lester G. Telser, pioneering economist and generous teacher, 1931–2022

    Alum and scholar of core theory was part of UChicago community for decades 

    Lester G. Telser, a pioneering figure in economics who studied and taught at the University of Chicago for more than 50 years, passed away Sept. 3. He was 91. 

    A prominent scholar during a defining era of UChicago economics, Telser, PhD’56, made significant contributions to the field. Described by his colleagues as a rigorous, eager intellect, Telser maintained a wide range of research interests, including futures and forward markets, industrial organization, and his life’s work—core theory, a variant of game theory. 

    Black and white headshot portrait of man wearing glasses, in a tuxedo

    “I was continually impressed by his broad knowledge and interests in economics well beyond the very important contributions he made to economic theory and industrial organization,” said Lars Peter Hansen, the David Rockefeller Distinguished Service Professor in Economics, Statistics and the Booth School of Business. “His intellectual curiosity was remarkable.” 

    Born in Chicago on Jan. 3, 1931, Telser grew up in the midst of the Great Depression—a period that would heavily influence his decision to study economics. A few years later, his family moved to the Hyde Park neighborhood, a community Telser called home for most of his life.  

    He attended Roosevelt University soon after its founding, where he began to study mathematics and economics. Though he was a gifted mathematician, he was drawn to the real-world problem solving of economics.  

    In a 2017 interview for the Berkeley Bancroft Oral History Project, Telser said: “The notion that motivated me, in living through the Great Depression, is very simple: How could things get so screwed up? It bothered me that it ought to be possible to figure out how to do things better.” 

    After a year at Harvard University, Telser returned to Chicago to earn his Ph.D. in economics from the University of Chicago in 1956. As a graduate student, he served as a research assistant at the Cowles Commission, which applies mathematical and statistical analysis to economic theory. His thesis, advised by Milton Friedman, among others: “The Supply of Stocks: Cotton and Wheat” became a seminal study on futures markets—a scholarly focus of Telser’s for decades.  

    In the fall of 1956, while an assistant professor at Iowa State College, Telser was drafted into the U.S. Army. After his two-year service, Telser returned again to the University of Chicago as a faculty member in the Graduate School of Business (now Chicago Booth). In 1964, he joined the Department of Economics as a professor, a position he held for over three decades. 

    Though Telser had many research interests, he is probably most known for his work on core theory—a variant of game theory that involves groups of people working cooperatively, as opposed to individuals, to maximize their advantage. “He was doing game theory when virtually no one else was,” said James Heckman, Henry Schultz Distinguished Service Professor in Economics and the College. 

    He was doing game theory when virtually no one else was.

    -James Heckman

    Not easily swayed by prevailing sentiments or department politics, Telser was driven by his own intellectual curiosity rather than what was popular. “He kept his own compass; he went his own course,” said Heckman. “There were a lot of topics he did that were not standard at the time, that pushed out the frontier. It made him an interesting person as a colleague and as an economist.” 

    Telser became a leading expert on core theory, publishing several influential books including Competition, Collusion, and Game Theory; Theories of Competition; and The Core Theory in Economics: Problems and Solutions. 

    According to Robert Shimer, the Alvin H. Baum Professor in Economics and department chair, core theory remains “not only an important tool for analyzing antitrust regulation and other important topics in industrial organization, but also to study voting and the provision of public goods.”  

    A patient and generous teacher 

    Alongside his own contributions to the field, Telser’s active engagement with his students was equally significant. Far from a passive lecturer, he led students in lively discussions—often tailored to their interests. He challenged them to voice their own viewpoints and taught difficult theoretical concepts with clarity and precision. Over the course of his career, Telser supervised over 150 dissertation projects and many Ph.D. exams. 

    “The generosity to share his knowledge with his students was, in my view, unparalleled,” said Victor Lima, PhD’01, a senior instructional professor in Economics and the College. 

    A former student of Telser’s, Lima participated in Applied Price Theory workshops, in which the accomplished economist worked closely with his students and fostered a rigorous, yet thoughtful and encouraging environment. When a student struggled with a concept, Lima said, Telser would patiently lead them through it.  

    “He’d push you when you needed it; he’d pull you when you needed it,” said Lima. “He would see you through until you really understood things well.”  

    He would see you through until you really understood things well.

    -Victor Lima

    After his retirement in 1997, Telser remained a vibrant member of the academic community at UChicago. He continued to publish papers, engage in lively debates with colleagues and dole out book recommendations. 

    “When I think of Lester, I think not only of an off-the-charts great economist, but also an all-around brilliant man with deep knowledge in a lot of different fields,” said Lima. “He was a very generous, kind man.”  

    Telser’s wife Sylvia, whom he married in 1956, preceded him in death in 2020. He is survived by his children Joshua (married to Esther Tryban) and Tamar (married to Ronald Schwartz), his grandchildren Leena Schwartz and Cara Schwartz, his younger brother Alvin Telser (married to Karen Telser), and his nieces and nephews Anna Daniels, Katie Telser, Jeffrey Trossman, Cindy Goldfarb, Andrew Trossman and Melanie Trossman. 

    View the original obituary for Lester G. Telser at news.uchicago.edu.

  • How Michael Kremer is Transforming Global Research in Development Economics

    Nobel laureate's experimental approach aims to tackle root cause of poverty

    In 1985 a new college graduate named Michael Kremer traveled to Kenya hoping to learn more about a topic he had studied at Harvard: economic development in low-income countries. He didn’t anticipate that an official in the village where he was staying would invite him to teach at a new school—but Kremer stayed in the country for a year to do just that. In fact, he cofounded an organization, WorldTeach, to send more teachers to Kenya and ultimately to several other developing countries.

    Given the opportunity to make a difference, Kremer jumped in, backing up a moral commitment to improving human life with hands-on work and entrepreneurial spirit.

    When he returned to Kenya in the early 1990s, Kremer was just starting his academic career as an economist at MIT. His plan was to meet up with old friends and spend time just “being a tourist,” he says. But the opportunity to help arose again. One friend, a Kenyan who was working for a small Dutch nongovernmental organization operating in Africa, was trying to identify schools in which to roll out a program intended to improve learning. Kremer offered a casual suggestion: select schools in a systematic way, then compare outcomes in those schools with outcomes in the same number of similar schools where the program was not operating.

    After returning home Kremer heard from his friend that the NGO was interested in trying out the approach. It was the start of a relationship that helped determine the trajectory of Kremer’s research in economics: he got involved not only with the Kenyan school study but with other experiments being done by the organization, today called ICS Africa, helping it develop evidence-backed programs.

    Kremer’s desire to help was evolving into a scientific methodology, one that would complement the most established approaches in his discipline.

    “Randomized controlled trials had been used in medicine for a very long time,” he says, noting that some economists and other social scientists had also used them. And yet the technique had not broken through widely in economics, which largely either focused on theoretical models or relied on existing data. Early in Kremer’s career, the subfield of development economics—which studies economic issues in low- and middle-income countries—was no exception.

    We know a lot less than we think we know.

    - Prof. Michael Kremer

    The results that came back from the Kenyan schools were unexpected. Studying a rural part of the country that had one textbook for every 17 students, Kremer and fellow researchers hypothesized that increasing the number of textbooks would increase average test scores. Their 2009 paper concluded that it did not. Only the the students who scored highest on pretests improved, since the intervention failed to address a deeper problem: a curriculum heavily geared toward the strongest- performing students. Historically, Kenyan schools have been judged on their ability to produce a handful of excellent students, not how well they meet the needs of the majority. Once it was clear that more textbooks alone wasn’t the solution, other interventions—such as remedial education for students who have fallen behind and flexibility for different schools to cover materials at their own pace—could come into view. Since then, other researchers have worked with NGOs, particularly Pratham in India, to develop such interventions, which now reach hundreds of millions of students each year.

    Kremer and his colleagues had hit upon a virtuous circle: an experimental result can uncover hidden factors, suggesting new directions for intervention and evaluation. This process can be repeated for as long as it proves fruitful.

    Kremer was born in New York City to parents who were both children of Jewish immigrants from Europe. He came of age in the orbit of Kansas State University, where his father, Eugene Kremer, taught architecture, and his mother, Sara Lillian Kremer, was a professor of English. He credits his mother, who authored two books on literary representations of the Holocaust, with teaching him the necessity of addressing preventable suffering and injustice in the world—the key motivation behind his work, from founding WorldTeach to conducting research in Kenya and beyond.

    Kremer and his wife and collaborator Rachel Glennerster—a British development economist who joined the UChicago faculty as an associate professor in 2021—take this intention to heart in their research as well as in their personal philanthropy: they’re part of the Giving What We Can Pledge, a commitment to give 10 percent or more of their lifetime income to high-impact charities.

    To prevent suffering, from an economist’s perspective, means asking what interventions will do the most good in the most efficient way. Kremer holds up another ICS Africa program as an example of how a “catalytic investment” by an NGO can scale up. This program addressed the problem of intestinal worms, parasites that infect hundreds of millions of people globally—over a quarter of the world’s population—especially in warm areas with poor sanitation. Sometimes the worms lead to debilitating digestive, nutritional, and developmental problems.

    In the early 2000s, Kremer and a colleague set out to study a group of 75 schools in Kenya. They found that a school-based program providing deworming pills to all students reduced absenteeism by more than 25 percent—a staggering result improving the health and well-being of the children directly affected, and likely of the entire local population and its economy over time. In their 2004 paper, the authors argue that the positive spillover effects easily justify providing free universal treatment to school-age children in high-risk areas.

    Officials took note. After the study, with the support of NGOs, the program was scaled nationwide by the Kenyan government. From there it was picked up by multiple Indian states—and then by the Indian national government. Today the world’s second most populous country holds National Deworming Day twice a year, administered through public schools.

    Bringing actionable research findings to the governments of developing countries is a major goal of Kremer’s research. “We’re not mainly writing for foreign aid donors or philanthropists,” he says, although he’s happy if they read his work. “The big win is if the Indian government decides to scale up deworming, reaching hundreds of millions of people.”

    Helping to establish the experimental method in development economics earned Kremer a share of the 2019 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. In awarding the honor to Kremer, Abhijit Banerjee, and Esther Duflo, the committee heralded a burgeoning approach to reducing global poverty that “involves dividing this issue into smaller, more manageable questions.”

    Standing on stage at Stockholm University, Kremer opened his acceptance speech by describing the mentorship of a Kansas State University theoretical physicist, Larry Weaver. He recalled that he was surprised one day when Weaver mentioned being happy that a colleague had discovered an error in his work. He was happy, Kremer explained, “because he cared about advancing science.”

    Kremer views experimental economics as complementing the more abstract, model-based work that has long characterized the mainstream of the discipline. As he put it in his Nobel lecture, Kremer began his academic career working “mostly alone or with one or two coauthors, using models and data which others had collected.” It was serendipity, he said, that his time in Kenya gave him the chance to work in the field, to collaborate with people in other fields, and to experiment with randomized controlled trials—a method that could “cleanly isolate the causal impact of a program or policy from confounding factors.”

    Through doing that work, one experiment at a time, he came to see how the experimental method could be elevated to “a fundamentally different type of economics research,” one distinguished by the richness of its empirical context and the specificity of the practical questions it attempts to solve.

    This way of working also requires a high degree of collaboration. “It’s obviously fantastic to get the prize,” Kremer says, but he is quick to spread the credit to a broad group of partners that includes fellow development economists; the personnel collecting survey data; allied researchers from disciplines such as education and psychology; funders like the British Department for International Development (now the Foreign Commonwealth and Development Office), the World Bank, and the US Agency for International Development (USAID); and the farmers, teachers, and other people he has met and learned from. “You wind up spending a lot of time in the field,” Kremer says. “That exposes the economist to a richer set of ideas.”

    In his Nobel lecture Kremer shared his greatest hope for the work he does: “innovations in social institutions designed to accelerate scientific and technological change and orient it toward human needs.”

    In 2020 Kremer brought his engaged experimental approach to the University of Chicago when he joined the Kenneth C. Griffin Department of Economics and the Harris School of Public Policy as a University Professor. It’s technically not the first time Kremer has taught on the quads—he was a visiting professor in the spring of 1993—but his responsibilities are much greater today. Notably, he is serving as faculty director of the new Development Economics Center, part of the Becker Friedman Institute for Economics (BFI).

    Announced in January, the Development Economics Center continues the interdisciplinary work of BFI’s previous Development Economics Research Initiative: developing collaborative approaches to the challenges faced by lower-income countries, engaging with policy makers, and awarding grants to UChicago PhD students and junior faculty working in the field. The Development Economics Center also includes the Weiss Fund for Research in Development Economics, to which Kremer and his co-recipients donated their Nobel Prize money, and the Development Innovation Lab, where Kremer has been serving as founding director since his arrival in 2020.

    “The University of Chicago is extremely fortunate to have Michael Kremer leading our collaborative development economics efforts,” says BFI director Michael Greenstone, LAB’87, the Milton Friedman Distinguished Service Professor in Economics and the College. He calls Kremer “a true pioneer in conducting experiments with randomized controlled trials to explore the root causes of poverty in developing countries.”

    That work, agrees economics chair and Alvin H. Baum Professor in Economics and the College Robert Shimer, “has been really transformative for the type of research people are doing in development economics, the kinds of questions they’re asking, and outcomes that are improving people’s lives around the world.” Even so, this tells only part of the story. Kremer “is a broad economist whose work is both theoretical and empirical,” Shimer adds, and the fruitfulness of his experiments relies on the strength of the theory informing them.

    “To do good empirical research, you also need to understand economic theory to have a sense of where to look for solutions,” Shimer says, pointing out that Kremer’s theoretical acumen has been applied widely. For instance, building on a body of past work on the economics of vaccine development, Kremer has turned much of his attention since arriving on campus to the pressing global public health issue that emerged around that time: COVID-19.

    Early in the COVID-19 pandemic, Kremer was asked by several governments and international agencies for advice on vaccine financing. He assembled the Accelerating Health Technologies group, which includes economists as well as biostatisticians with expertise in epidemiology and pharmacology. Together they conducted analysis and made recommendations to policy makers. For example, they advised the US government in the run-up to Operation Warp Speed, the public-private partnership initiated in 2020 in which different vaccines were developed simultaneously and produced before their efficacy was known. Speed was critical, and it would have been “penny-wise and pound-foolish,” Kremer says, to delay building large factories to develop these unproven vaccines, even if the facilities cost millions of dollars.

    The United States and United Kingdom went for this approach, but Kremer says he would have preferred to see it happen on an even larger scale—with vaccine production capacity being built in advance for as many as 15 or 20 different vaccines. The fact that multiple vaccines worked for COVID-19 is “really lucky,” he believes, given that there are far longer-known viruses like HIV that we still have not figured out how to inoculate ourselves against.

    Vaccines also raise an issue that economists think about regularly: supply and demand. After effective vaccines are developed, there is still the question of getting them where they are needed. Chicago Booth’s Eric Budish, the Paul G. McDermott Professor of Economics and Entrepreneurship, and Canice Prendergast, the W. Allen Wallis Distinguished Service Professor of Economics, have contributed to the work on this problem. Building on his prior research on using market mechanisms to meet demand at food banks, Prendergast—also an affiliate of the Development Economics Center and a member of the Accelerating Health Technologies group—worked to design a system that would allow a country to send its surplus vaccine supply to other countries in need and then get paid back with doses later, when its own supply falls low.

    For the past couple decades Michael has been one of the leading thinkers on incentives for creating new vaccine research.

    - Prof. Christopher Blattman

    Kremer’s contributions to the world of vaccine development predate the emergence of the novel coronavirus. In 2004 Kremer and Glennerster proposed something called an advance market commitment (AMC) in their book Strong Medicine: Creating Incentives for Pharmaceutical Research on Neglected Diseases (Princeton University Press).

    The coauthors were aiming to address a basic problem in market economies: no matter how many people need a product, they will not constitute a market for that product if they do not have the money to pay for it. Malaria killed over 600,000 people in 2020, for instance, but markets do not necessarily respond to sickness and death.

    An AMC creates a market where there was none. It asks donors to agree in advance to subsidize the initial purchase of effective vaccines by lower-income countries if those vaccines are developed. The purchasing country pays a nominal copayment; the vaccine maker agrees to a price affordable in the developing country; and the donor fund contributes a per-dose top-up price to ensure the company’s investment in research and development is repaid. In this way, private firms are incentivized to undertake research and development for treatments that might not otherwise be profitable.

    Kremer’s studies use economic analyses to design interventions for human good, and AMCs show how diverse these interventions can be: a change in curriculum, a deworming pill, or an entirely new kind of market.

    In 2007 a pilot AMC intended to spur a vaccine for pneumococcus—the main cause of pneumonia globally—netted a pledge of $1.5 billion from a group of donors comprising the Bill & Melinda Gates Foundation and the countries of Canada, Italy, Norway, Russia, and the United Kingdom. The AMC kicked off in 2009 under the supervision of Gavi, the Vaccine Alliance (formerly the Global Alliance for Vaccines and Immunization), with firms competing for 10-year vaccine supply contracts intended to inoculate children in more than 70 countries meeting specific criteria. By the time of a 2020 paper, Kremer and two coauthors, all of whom had helped design the pilot, were able to report the development of three vaccines by different firms, 150 million children immunized, and an estimated 700,000 lives saved.

    “For the past couple decades Michael has been one of the leading thinkers on incentives for creating new vaccine research,” says Christopher Blattman, the Ramalee E. Pearson Professor of Global Conflict Studies, citing the pneumococcus vaccine as well as a promising new malaria vaccine as examples of incentives at work.

    AMCs are not limited, in principle, to vaccine development. It’s a heady idea: if there is no market for addressing some need, you can try to create one.

    For instance, AMCs may become a new tool in the fight against climate change. In a story that cites the pneumococcus AMC as precedent, National Public Radio has reported on the idea of using an AMC to incentivize entrepreneurs to develop carbon-removal technologies. While climate activists agree that carbon emissions must be reduced at the source, the idea of extracting massive amounts of existing carbon out of the atmosphere is gaining traction. Among those calling for a carbon-removal AMC is Glennerster, who helped make the case for the strategy in a December Politico opinion piece, floating the idea of a $1 billion commitment to provide a “critical demand signal to scientists, founders and investors, giving them the confidence needed to begin building now.”

    Again and again, Kremer has conducted small studies to approach big problems. In many ways, these studies are a natural complement to existing research at UChicago. For instance, Kremer has used ideas from behavioral economics—another empirically informed subfield of economics that has grown in recent decades thanks to the work of 2017 Nobelist Richard Thaler, the Charles R. Walgreen Distinguished Service Professor of Behavioral Science and Economics, and others at UChicago. As opposed to neoclassical economics, which assumes that people act according to well-defined, rational preferences, behavioral economics draws on insights from psychology to model and describe people’s real-world behavior.

    For example, in addressing the problem that hundreds of thousands of children die of diarrhea each year due to unsafe drinking water, Kremer and colleagues did not merely test the efficacy of a treatment (a simple dilute chlorine solution). They also asked how to get people to use it. What is the right “nudge,” in the language of behavioral economics, to get the desired behavioral result?

    As with intestinal worms, a promising treatment was at hand, ready to be backed up by experimentation. Water treatment with chlorination is cheap, effective, and widely available. But in rural Kenya, few people treated their water. Kremer and his colleagues found that placing dispensers of water treatment solution at public water sources substantially increased usage. Public dispensation gives people the convenience of adding the treatment right as they draw their water—and the fact that it’s public means they are modeling the practice for others. Sensitivity to habits, biases, and social cues, as opposed to abstract preferences, proved useful to understanding and influencing people’s actions in the real world.

    Notably, Kremer’s prior research had already indicated that use of the water treatment significantly increased when it was free instead of merely low-cost, a finding that runs counter to the notion that you must charge something for a product to make people value it. For this kind of product under these conditions, charging nothing is demonstrably better than charging next to nothing.

    Christina Brown, a Saieh Family Fellow at the Becker Friedman Institute, says that reading Kremer’s research as a master’s student showed her that she didn’t have to choose between academic research and making a difference in the world. Brown, who is slated to join the economics department as an assistant professor in 2023, will work along with Kremer to further bolster development economics at the University.

    “While there have always been fantastic development economists at Harris and Booth, the economics department did not have as many scholars in that area as of a few years ago,” Brown says. Now, she believes, the University of Chicago is “in the top two or three places in the world to study and do development work.”

    As Kremer inspires young scholars in his field—and funds them through the Development Economics Center—he continues pursuing his own research into the causes and conditions of poverty. Commentators tend to have a favorite go-to solution for the problem, he notes: more education, more physical capital, more democracy, and so on. In his experience, though, the solution depends critically on the country, the local community, and the sector of the economy. “We know a lot less than we think we know,” he says, and focusing on the specifics can “break you out of some theoretical straitjackets.” Deeper understanding is often just a well-designed experiment away.

    —This story was originally published on the University of Chicago Magazine website.

     

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