Dear Commons Community,
On Monday, the 2021 Nobel Memorial Prize in Economic Sciences was awarded to three Americans: David Card, Joshua D. Angrist and Guido W. Imbens.
David Card has made a career of studying unintended experiments to examine economic questions — like whether raising the minimum wage causes people to lose jobs.
Joshua D. Angrist and Guido W. Imbens have developed research tools that help economists use real-life situations to test big theories, like how additional education affects earnings.
All three winners are based in the United States. Mr. Card, who was born in Canada, works at the University of California, Berkeley. Mr. Angrist, born in the United States, is at the Massachusetts Institute of Technology, and Mr. Imbens, born in the Netherlands, is at Stanford University.
“Sometimes, nature, or policy changes, provide situations that resemble randomized experiments,” said Peter Fredriksson, chairman of the prize committee. “This year’s laureates have shown that such natural experiments help answer important questions for society.”
The recognition was bittersweet, many economists noted, because much of the research featured in the prize announcement was co-written by Alan B. Krueger, a Princeton University economist and former White House adviser who died in 2019. The Nobels are not typically awarded posthumously. Despite that note of sadness, the economics profession celebrated the news, crediting the winners for their work in changing the way that labor markets in particular are studied.
“They ushered in a new phase in labor economics that has now reached all fields of the profession,” Trevon D. Logan, an economics professor at Ohio State, wrote on Twitter shortly after the prize was announced.
Mr. Card’s work has challenged conventional wisdom in labor economics — including the idea that higher minimum wages led to lower employment. He was a co-author of influential studies on that topic with Mr. Krueger, including one that used the border between New Jersey and Pennsylvania to test the effect of a minimum wage change. Comparing outcomes between the states, the research found that employment at fast food restaurants was not negatively affected by an increase in New Jersey’s minimum wage.
Mr. Card has also researched the effect of an influx of immigrants on employment levels among local workers with low education levels — again finding the impact to be minimal — and the effect of school resource levels on student education, which was larger than expected.
Congratulations to these Nobel winners.
Tony
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