10 Feb 2021 22:05 IST

Nobel laureate Prof Abhijit Banerjee delivers a lecture at IIMC

He discussed various reasons why poverty traps exist including credit constraints and risk appetite

The Indian Institute of Management, Calcutta organised the third edition of the Professor Amitava Bose Memorial Lecture virtually on February 9. The lecture was delivered by Nobel laureate Professor Abhijit Banerjee.

Speaking on the topic — ‘Temporary interventions and its impact on poverty traps’ — Banerjee explained the theoretical framework of capital accumulation model. He showed how one-time temporary boost in capital stock can lead to breaking away from the poverty trap to virtuous cycle leading to huge social returns on investment.

Banerjee then discussed various reasons why poverty traps exist including his work on credit constraints and risk appetite constraints of the very poor which leads to the poverty trap. He elaborated with imperial evidence by showing results from multiple randomised controlled trial (RCT) conducted in Ghana, Honduras, India and Bangladesh among others to hint that short term interventions can have a huge impact to overcome poverty traps. This could have key implications in terms of policy design and social sciences.

Prof Banerjee spoke of his long association with Prof Amitava Bose who was his father’s (Prof Dipak Banerjee) student. Late Professor Amitava Bose joined IIMC in 1974 as an Assistant Professor and was a Professor at the institute since 1980. An expert at macro economics, he went on to become the director of IIM Calcutta and was known as a “renaissance individual and possessed a huge sense of sartorial elegance,” said a press statement issued by IIMC.

“Prof Bose continues to be an inspiration to legions of students and the memorial lecture is a tribute to admiration everyone at IIMC has towards him,” the release said.