DATELINE — Since 1969, the Nobel committee has annually awarded pioneering individuals the prestigious award for their outstanding work within the field of economists. This year, 69-year-old trailblazer Angus Deaton was awarded the Nobel Prize.
A professor at Princeton University since 1983, Deaton has received the award in recognition of his three decades worth of research analyzing welfare in the developing world and the relationship between income and spending.
Angus Deaton’s research analyzes three questions: How do consumers distribute their spending? How much of society’s wealth is spent and approximately how much is saved? And what is the best method to study health and poverty?
“Mr. Deaton’s work covers a wide spectrum–from the deepest implications of theory to the grittiest detail of measurement,” said the Nobel committee.
His most widely known and famous study deals with household surveys, primarily in India, which took place between the 1980s and 1990s.
In the study, Angus Deaton collected detailed information about individual household spending within various situations. For example, Deaton once compared the relationship between income and the amount of calories people ate per day.
Instead of focusing on income within India’s economy as a whole, Deaton’s attention to household information forced him to focus on the individual unit instead of an entire population. Unlike economists before him who focused on larger scale studies, Deaton wanted to understand how an individual makes the choices they do.
“It’s about people in the end,” said Deaton during a gathering at Princeton University after he was named the Nobel Peace Prize Winner in Economics. “You have to understand what makes people tick.”
From his research, Deaton proved that malnutrition was caused by a low income.
While some believed low income was the cause of less calorie intake, Deaton showed that increasing people’s income led to a higher calorie intake among the poor.
Using the data from the study, Deaton more accurately compared living standards and poverty levels across different time periods and countries, especially developing countries where less information on poverty existed at the time.
Deaton used the data to answer questions regarding health, development and poverty. Through his study’s success, Deaton took his household study to other parts of the world, including South Africa and the United States.
His critical analysis of individual households has transformed microeconomics, econometrics, macroeconomics and development economics.
After receiving the Nobel Peace Prize, Deaton commented that climate change and inequality are the two great challenges facing the world and without intervening, both will continue to go downhill.
“I do worry about a world in which the rich get to write the rules. There’s still 700 million people who are poor and those are a constant reproach to all of us,” said Deaton.
The UN’s goal is to end all forms of poverty worldwide by 2030, and Angus Deaton’s work has influenced public policy in regards to aid and poverty. With a timely announcement during a time of uncertainty, Deaton’s recognition from his recent Nobel Prize win could spur a different approach to solving global poverty.
“Those of us who were lucky enough to be born in the right countries have a moral obligation to reduce poverty and ill health in the world,” said Deaton.
– Alexandra Korman
Sources: Co. Exist, Learning English, The New York Times, The Telegraph
Photo: Fast Company