The Canadian David Card, the American Joshua D. Angrist and the Dutchman Guido W. Imbens have been awarded this year with the . The first of them has received recognition “for their empirical contributions to labor economics”, while Angrist and Imbens share the other half of the award “for their methodological contributions to the analysis of causal relationships”, as announced by the Royal Swedish Academy of Sciences this Monday.
Thus, of the 10 million Swedish crowns (988,113 euros) of which the Nobel Prize in Economics consists, five million will go to Card while the other five will be divided equally between the other two winners.
natural experiments
The three winners (Card, Angrist and Imbens) have provided with their work and research “new knowledge about the labor market and have shown what conclusions about cause and effect can be drawn from natural experiments,” explains the Swedish academy. “His approach has spread to other fields and revolutionized empirical research,” he adds.
How does immigration affect wages and employment? How important is a longer education really to a person’s future income? These and other questions in the social sciences are difficult to answer and have to do with cause and effect. What the three winners of the 2021 Nobel Prize in Economics have done is show that it is possible to answer these types of questions through natural experiments.
“The key is to use situations in which random events or political changes cause groups of people to be treated differently, similar to clinical trials in Medicine,” says the Royal Swedish Academy of Sciences in its statement.
BREAKING NEWS:
The 2021 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded with one half to David Card and the other half jointly to Joshua D. Angrist and Guido W. Imbens.
— The Nobel Prize (@NobelPrize)
Card and his challenge to the ‘common sense’ of labor economics
David Card sounded in the pools for the Nobel. In 2014 he already received the BBVA Foundation Frontiers of Knowledge Award in Economics, recalls Europa Press.
The Canadian, who receives half of the award for himself (more than 494,000 euros), has dedicated his career to analyzing through natural experiments the effects on the labor market of minimum wages, immigration and education.
His studies from the early 1990s challenged common sense, leading to new analyses. For example, Card demonstrated, among other things, that raising the minimum wage does not necessarily lead to fewer jobs.
Their works have also highlighted the high importance of school resources for the future success of students in the labor market, among other things, highlights the Swedish academy.
Angrist and Imbens demonstrated how to get accurate cause-effect results.
However, data obtained from a natural experiment are difficult to interpret. And this is where the merit of the other two winners this 2021 with the Nobel lies.
In the mid-1990s, Guido W. Imbens and Joshua D. Angrist (whose names appeared among the most high-profile candidates for the award, such as Card) solved this methodological problem by showing how accurate conclusions about cause and effect can be drawn. from natural experiments.
“Card, Angrist and Imbens have shown that natural experiments are a rich source of knowledge”
In short, “Card’s studies on fundamental issues for society and the methodological contributions of Angrist and Imbens have shown that natural experiments are a rich source of knowledge”, has defended Peter Fredriksson, president of the Economic Sciences Prize Committee.
“Their research has substantially improved our ability to answer key causal questions, which has been of great benefit to society,” Fredriksson stressed, according to the Swedish institution’s press release.
Professors at US universities
David Card was born in Guelph (Canada) in 1956 and received his doctorate in 1983 from Princeton University. He is currently a Professor of Economics at the University of California at Berkeley.
Joshua D. Angrist and Guido W. Imbens also work at American universities. The first at the Massachusetts Institute of Technology (MIT) in Cambridge and the second at Stanford University.
Angrist was born in 1960 in Columbus (Ohio, USA) and also received his doctorate from Princeton University in 1989. Imbens, for his part, was born in Eindhoven (Netherlands) in 1963 and received his doctorate from Brown University (in Providence, USA) in 1991.
History of the Nobel Prize in Economics
The Nobel Prize in Economics, whose name is actually the Alfred Nobel Memory Economic Sciences Prize, is the only one of the six awards that was not created in its day by the Swedish magnate, but was instituted in 1968 from a donation to the Nobel Foundation of the Swedish National Bank on the occasion of its 300th anniversary.
Thus, the first time the Royal Swedish Academy of Sciences awarded the award was in 1969. Since then it has delivered a total of 53 awards to 89 different people.
The first winners were Ragnar Frisch and Jan Tinbergen. for “his improvements in auction theory and inventions of new auction formats”, as the Swedish organization highlighted at the time.
In 2019, in history. The first woman to obtain it was the American Elinor Ostrom twelve years ago. Leonid Hurwicz, in 2007, was the oldest person to receive the award (with 90 years).
The Nobel Prize in Economics has been awarded eight times to three people at the same time. Another 20 prizes have been awarded to two people at the same time, and the remaining 25 to just one. So far, no Spanish person has won the Nobel Prize in Economics.
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