Abhijit Banerjee, Esther Duflo and Michael Kremer just received the 2019 Nobel Price in Economics. Banerjee and Duflo are husband and wife working at MIT and Kremer is at Harvard, all specializing in finding practices to alleviate poverty in the world based on rigorous scientific experiments.
The Nobel price committee observed that “Their experimental research methods now entirely dominate development economics”. Their method was lifted from pharmaceutical research methodologies and transplanted into social science settings and is named Randomized Controlled Trials (RCT), which Duflo very well explains in her TEDTalk .
One of the findings in their research programme was, for example, that microfinance had a much smaller impact on communities than expected. This is of relevance for MR because it is an experiment with an alternative method of issuing credit, i.e. banking .
So, while reading about their research and research methodology the idea formed to at least formulate the possibility to do research on monetary reform on a small scale.
So far the MR community has made the plausible assumption that the smallest scale for MR is a nation state with its own sovereign currency. The question Duflo’s research methodology opens is to have an MR experiment on a smaller scale by choosing two regions to do an approximate randomized trial, one region to do the experiment and the other as control.
Would there be an ingenious way to design such an experiment? To be honest, I get stuck within the grooves of thinking that you cannot change a region’s current banking practices to conduct the experiment. And this idea leads to the inevitable conclusion that the assumption that such an experiment can only be done at the scale of a nation-state is not only plausible, but even inescapable.
. Banerjee, Abhijit, Esther Duflo, Rachel Glennerster, and Cynthia Kinnan. 2009. “The Miracle of Microfinance? Evidence from a randomized evaluation”. Centre for Micro Finance, Working Paper Series No. 31. Also in: American Economic Journal: Applied Economics, 2015, 7(1): 22–53.
Govert Schüller is a Dutch-American author who writes about Jiddu Krishnamurti and Theosophy. He studied philosophy in the Netherlands and studied under the Heidegger scholar Theodore Kisiel at Northern Illinois University. He recently finished his masters degree at the University of Wales on the topic of narrative identity theory. For 22 years he has been maintaining Alpheus.org, a website looking at religion, spirituality and politics from a critical, skeptical, and evolutionary point of view. He became interested in monetary reform after meeting Stephen Zarlenga in 2008. After attending the 2014 conference of the American Monetary Institute he participated in many of its activities promoting monetary reform.
When we change our money system from debt-money created by private bankers to government-created asset money, will that lead to inflation? No. It will establish steady-value currency that will eliminate