Digital Desk, America. Three American academics from prestigious universities have been awarded the Nobel Prize in Economics for their contributions to the adoption of diagnostic testing techniques to understand the cause and effect of economic phenomena, particularly the labor market and its dynamics. The Royal Swedish Academy of Sciences announces the Sveriges Riksbank Prize in Economic Sciences in memory of Alfred Nobel 2021, or the Economics Nobel, to economics professor David Card for his empirical contributions to labor economics, and to Joshua D. Angrist and Guido W. Imbens. Given for his methodological contribution to the analysis of relationships.
Card (65) is a professor of economics at the University of California, Berkeley. He will receive half of the 10 million Swedish kronor ($1.14 million) prize money. The rest of the prize money will be shared between Angrist (61), a professor of economics at Ford University, and Imbans (58), a professor of economics at Stanford University. According to the Society, the cause-and-effect relationship underlies key questions in the social sciences, particularly economics, such as the effect education has on future earning potential. However, three prize winners have shown that it is possible to answer other similar questions using natural experiments.
The Academy said that the vision of the awardees has spread to other fields and has revolutionized empirical research. Card has used naturalistic experiments to analyze the labor market effects of minimum wages, immigration and education, and his early 1990s studies challenged conventional wisdom, yielding new analyzes and additional insights.
The results showed, among other things, that raising the minimum wage does not necessarily lead to fewer jobs, the academy said in a statement. We now know that the income of people born in the country can benefit from new immigration, while those who immigrated in earlier times are at risk being negatively impacted. We have also realized that having resources in schools is more important than ever for students’ future labor market success.