Nobel winner David Card revolutionized thinking about minimum wage

qz.com
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fairly difficult
The Nobel in economics went to David Card, a Berkeley economist, whose research on minimum wages continues to have ongoing relevance.
David Card, whose research on the minimum wages of fast-food workers deepened the understanding of how labor markets operate, was awarded the Nobel prize in economics today (Oct. 11).

Card shared the prize with fellow US-based economists Joshua Angrist and Guido Imbens who demonstrated what cause-and-effect conclusions can be drawn from natural experiments and helped increased the credibility of empirical research, according to the Nobel Economics Sciences Prize Committee.

Card, 65, an economics professor at University of California, Berkeley, published a paper in 1993 with the late economist Alan Krueger that provided a different way of thinking about setting wages. Prior to their paper, the conventional wisdom in economic research was higher minimum wages reduced employment.

Card and Krueger compared the employment rates at 410 fast-food restaurants, including Burger King, KFC, and Wendy's, in New Jersey and nearby Pennsylvania. They compared employment, wages, and prices at stores in New Jersey, which had raised its minimum wage, a year before, from $4.25 to $5.05 per hour a year and Pennsylvania, which hadn't changed its minimum wage. The researchers found the changes in one state's minimum wage made no difference in employment…
Michelle Cheng
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