Nobel Prize - 850m people lifted out of poverty not important

ANN ARBOR, Michigan: This year’s Nobel Memorial Prize in Economic Sciences was awarded to Abhijit Banerjee, Esther Duflo, and Michael Kremer for their experimental approach to poverty reduction.

In the Nobel Committee’s view, the economists’ use of randomised controlled trials (RCTs) to test whether specific interventions work – a method adapted from medical sciences – has “considerably improved our ability to fight global poverty”....

Conspicuously missing from this debate is the experience of China, which has accounted for more than 70 per cent of global poverty reduction since the 1980s, the most successful case in modern history.

Over the last four decades, more than 850 million people in China have escaped poverty. As Peking University’s Yao Yang notes, this had “nothing to do with RCTs”, nor did it involve giving handouts to the poor.

Instead, it was the result of rapid national development....

 What Yao fails to acknowledge, however, is that China’s impressive record of poverty reduction has been accompanied by two serious problems: Inequality and corruption.

When President Xi Jinping took office in 2012, China’s Gini coefficient (the standard measure of income inequality, with zero representing maximum equality and one representing maximum inequality) stood at 0.47, higher than in the United Kingdom or the United States.

A Chinese household survey reported an even higher coefficient of 0.61, nearly on par with South Africa.

A rising tide lifts many boats, but some rise far higher than others. So, while millions of Chinese were lifted just above the poverty threshold, a few individuals were catapulted to the heights of opulence.

Read more at https://www.channelnewsasia.com/news/commentary/china-poverty-escape-economics-growth-inequality-nobel-prize-rct-12103676

The above CNA article is written by Ang Yuen Yuen, oops, it is Yuen Yuen Ang. Not sure to address her as Ms Yuen or Ms Ang. Anyway, after reading the article I came to the conclusion that poor countries should not adopt China's economic model to reduce poverty. The Chinese model may have uplifted 850m Chinese from poverty level, many becoming middle class, but the cost to pay is too high. The income inequality is too big to be acceptable. 

I would recommend countries to follow the models of the 3 Nobel Prize winners, go for small growth and small improvements and avoid the big inequality gap like in China. It is not a good thing to uplift 850m people from poverty and ended with high inequality income. This may be the main reason why no Chinese economist is deserving of a Nobel Prize for a historical feat of mammoth proportion, never experienced in human history, to uplift 850m people from poverty in less than 40 years. This is bad. 

The moral of the story is to stay poor as long as income inequality is kept low. This is good for the people, good for the poor. Why lift them up from poverty and create high income inequality? Better that everyone is poor than to have many becoming less poor with some becoming obscenely rich.

The Nobel Prize committee made a politically clever decision not to award anyone that helped to raise 850m from poverty level.