UC Berkeley’s David Card wins 2021 Nobel Prize in Economics



David Card addresses the press during his Nobel Prize press conference on the UC Berkeley campus in Berkeley on Monday, October 11, 2021. Card received the Nobel Prize in Economics from the Nobel Committee for his work in labor economy. Credit: UC Berkeley

David Card, labor economist and professor of economics at UC Berkeley, won the 2021 Memorial Nobel Prize in Economics for work that challenged orthodoxy and radically altered understanding of inequalities and social forces and that impact low-wage workers. He received half the prize, with the other half shared by economists Joshua Angrist of MIT and Guido Imbens of Stanford University.

Card is best known for his pioneering studies in the 1990s which remain extremely relevant today, as they questioned prevailing assumptions about the impact of immigration on US-born American workers and the effect of minimum wage increases on national employment growth.

Card, 65, from Ontario, Canada, is the sixth UC Berkeley economist to win the Nobel Prize in economics and the 26th campus Nobel laureate. His predecessors are Oliver Williamson (2009), George Akerlof (2001), Daniel McFadden (2000), John Harsanyi (1994) and Gérard Debreu (1983).

Announcing the prize today in Stockholm, Sweden, the Economics Prize Committee of the Royal Swedish Academy of Sciences credited Card for its impact on policy debates on immigration, welfare reform and inequalities.

Card’s work “has helped answer important questions for society,” Peter Fredriksson, chairman of the committee, said at a press conference in Sweden. Card’s work, he added, “challenged conventional wisdom, which led to new studies and additional ideas.”

Taken together, the work of the three economists “revolutionized empirical work” in economics, the committee said.

Card learned of the award ceremony early Monday morning at his family’s Santa Rosa home – and thought it was a practical joke played by mischievous colleagues. He had just arrived after a day of traveling from a family event near Guelph, Ontario, Canada. The initial call from the Nobel Committee arrived at his family’s home in Berkeley, and a voicemail message was delivered to Santa Rosa.

“The message said the call was from Sweden,” he said immediately after winning the award. “I have a few friends who would do something like this.”

He greeted the news with an unassuming assessment of his work and its impact.

“My contributions are quite modest,” he said. “It’s about trying to get more scientific connections and evidence-based analysis in economics.

“Most of the old-school economists are very theoretical, but nowadays a lot of economics is really very technical, looking at things like education or health, or the effects of immigration or the effects of wage policies. These are really very, very simple things. So my big contribution has been to oversimplify the area.

And in the process of making it more useful in application?

“Well, that was my belief, but you’d probably get a mixed vote on it.”

This is the second year in a row that UC Berkeley faculty have won a Nobel Prize. Last year Jennifer Doudna received the Nobel Prize in Chemistry and Richard Genzel won the Nobel Prize in Physics.

A 1950 class economics professor at UC Berkeley, Card has co-authored and edited several books and over 100 journal articles and book chapters. He runs UC Berkeley’s Labor economics center, the campus Econometrics laboratory and previously, he was Director of the Labor Studies Program at the National Bureau of Economic Research.

In 1995, Card received the John Bates Clark Medal, awarded annually to an American economist under the age of 40 who is considered to have made the most significant contribution to economic thought and knowledge. He is widely regarded as a precursor to a Nobel Prize.

He is currently president of the American Economic Association.

The minimum wage: a challenge to orthodoxy

From the early 1990s, Card partnered with Princeton University economist Alan Krueger to conduct groundbreaking research on minimum wage. Krueger ultimately chaired President Barack Obama’s Council of Economic Advisers before his death in 2019. Writing about the minimum wage, they questioned the economic orthodoxy that had prevailed for decades.

In a 1993 article, they found that an increase in the minimum wage in New Jersey in 1992 had not hurt – and may even have spurred – job growth at fast food restaurants that were doing the job. object of its study.

In their book Myth and measure: the new economics of minimum wage (1995), the authors have extended and deepened their exploration of the question. The book has generated considerable controversy, but over time its findings have gained wide acceptance and it continues to have a great influence on decision-makers and policies in local, state and federal governments.

“Much of my work has focused on how the job market works for the less skilled or less able,” Card said in a 2006 interview with a publication from the Federal Reserve Bank. He added that he was motivated to “understand why some people succeed and others fail, and how their success or failure relates to the environment, to institutions and to the people themselves.”

Is Immigration Really an Economic Burden?

In one 1990 study Frequently referenced in immigration debates, Card found that the massive influx of Cuban refugees from the 1980 Mariel boat lift had minimal impact on Miami’s labor market, possibly due to the successful absorption by the city of two large waves of immigrants two decades earlier.

And in an article from 2005, “Is the new immigration really that bad?” “ he found that few immigrants who come to the United States without completing high school are likely to have average incomes equal to those of native-born residents. Even so, he argued, children born in the United States to immigrants end up earning enough to make up for their parents’ lack of income.

An abundance of honors

Card began undergraduate studies at Queen’s University in Ontario as a physicist, but turned to labor economics, an area he considered more practical. He obtained his baccalaureate in 1978, followed by a doctorate. in Economics from Princeton in 1983.

Card joined UC Berkeley’s Faculty of Economics in 1998 after teaching at Princeton, Harvard University, and the University of Chicago. The same year, he was elected to the American Academy of Arts and Sciences.

In 2006, Card and Krueger received the prestigious IZA Prize in Labor Economics from the Institute for Labor Economics in Bonn, Germany. A year later, Card received the Frisch Medal from the International Society of Econometrics, considered one of the top three honors in economics.

In 2013, Card was named John Kenneth Galbraith Fellow by the American Academy of Political and Social Sciences. He was elected president of the Western Economic Association International from 2014 to 2015 and was vice president of the American Economic Association the same year.

In recent years, Card’s research has looked at questions as diverse as how knowing a coworker’s salary affects a person’s sense of job satisfaction, the link between football match results and domestic violence, and the under-representation of low-income and minority students in gifted education programs in the United States.

In 2019, as an expert witness in a federal case against Harvard’s admissions process, he testified in favor of the university’s race-conscious approach to candidate selection, disputing allegations of a sanction against Asian American students.

Card, Angrist and Imbens will share a prize of SEK 10 million, or nearly $ 1.2 million.



About Author

Comments are closed.