There are reports of the auroras at lower latitudes of Scotland and Great Britain. If there is a chance of viewing any, it will be now. This is expected to last for weeks.
I am the Dwight D. Eisenhower Professor of Economics (click here) and International Affairs at the Woodrow Wilson School of Public and International Affairs and the Economics Department at Princeton University. My main current research areas are in health, wellbeing, and economic development.
I hold both American and British citizenship. In Britain I taught at Cambridge University and the University of Bristol. I am a corresponding Fellow of the British Academy, a Fellow of the American Academy of Arts and Sciences, and of the Econometric Society and, in 1978, was the first recipient of the Society's Frisch Medal. I was President of the American Economic Association in 2009. In 2012 I was awarded the BBVA Foundation Frontiers of Knowledge Award. In April 2014 I was elected a member of the American Philosophical Society. I was elected a member of the National Academy of Sciences on April 28, 2015.
My current research focuses on the determinants of health in rich and poor countries, as well as on the measurement of poverty in India and around the world. I also maintain a long-standing interest in the analysis of household surveys. To view information about my research on India and world poverty, health, or household surveys, click each corresponding link.
To view my working papers and publications and my letters published every six months in the Royal Economic Society Newsletter, click each corresponding link.
13 October 2015
The Royal Swedish Academy of Sciences has decided to award The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for 2015 to
Angus Deaton
Princeton University, NJ, USA
"Consumption Great and Small" (click here)
To
design economic policy that promotes welfare and reduces poverty, we
must first understand individual consumption choices. More than anyone
else, Angus Deaton has enhanced this understanding. By
linking detailed individual choices and aggregate outcomes, his research
has helped transform the fields of microeconomics, macroeconomics, and
development economics.
The work for which Deaton is now being honored revolves around three central questions:How do consumers distribute their spending among different goods? Answering this question is not only necessary for explaining and forecasting actual consumption patterns, but also crucial in evaluating how policy reforms, like changes in consumption taxes, affect the welfare of different groups. In his early work around 1980, Deaton developed the Almost Ideal Demand System – a flexible, yet simple, way of estimating how the demand for each good depends on the prices of all goods and on individual incomes. His approach and its later modifications are now standard tools, both in academia and in practical policy evaluation.
How much of society's income is spent and how much is saved? To explain capital formation and the magnitudes of business cycles, it is necessary to understand the interplay between income and consumption over time. In a few papers around 1990, Deaton showed that the prevailing consumption theory could not explain the actual relationships if the starting point was aggregate income and consumption. Instead, one should sum up how individuals adapt their own consumption to their individual income, which fluctuates in a very different way to aggregate income. This research clearly demonstrated why the analysis of individual data is key to untangling the patterns we see in aggregate data, an approach that has since become widely adopted in modern macroeconomics.
How do we best measure and analyze welfare and poverty? In his more recent research, Deaton highlights how reliable measures of individual household consumption levels can be used to discern mechanisms behind economic development. His research has uncovered important pitfalls when comparing the extent of poverty across time and place. It has also exemplified how the clever use of household data may shed light on such issues as the relationships between income and calorie intake, and the extent of gender discrimination within the family. Deaton's focus on household surveys has helped transform development economics from a theoretical field based on aggregate data to an empirical field based on detailed individual data.
Local economies are best for the USA economy. When Wall Street dominates the economic picture the trends into poverty AND economic contraction has to be far larger to be considered significant than it does in local assessments.
When cities and towns carry out regular assessments of it's wealthy engine and measures of homelessness and/or poverty, trends in decline can be discerned far earlier than Washington, DC will ever know. Literally, things like taxes can be adjusted on a micro scale to ward off poverty and increase advocacy at state and federal levels. When towns pick up their trends the local government can act to reverse that trend.
Mayors are important folks. They meet regularly with other mayors and talk about their economies. Mayors can measure their local economy success during these meetings. Meetings of Mayors can bring changes to improve economic growth far earlier than waiting for statistics to be large enough for Wall Street and Washington to finally pick it up.
Being a mayor of a town is being sophisticated and not just being nice to old ladies and kissing babies.
