The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2021

www.nobelprize.org
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fairly difficult
The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2021 was divided, one half awarded to David Card "for his empirical contributions to labour economics", the other half jointly to Joshua D. Angrist and Guido W. Imbens "for their methodological contributions to the analysis of causal relationships".
Press release: The Prize in Economic Sciences 2021

11 October 2021

The Royal Swedish Academy of Sciences has decided to award the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2021

with one half to

David Card

University of California, Berkeley, USA

"for his empirical contributions to labour economics"

and the other half jointly to

Joshua D. Angrist

Massachusetts Institute of Technology, Cambridge, USA

Guido W. Imbens

Stanford University, USA

"for their methodological contributions to the analysis of causal relationships"

Natural experiments help answer important questions for society

This year's Laureates – David Card, Joshua Angrist and Guido Imbens – have provided us with new insights about the labour market and shown what conclusions about cause and effect can be drawn from natural experiments. Their approach has spread to other fields and revolutionised empirical research.

Many of the big questions in the social sciences deal with cause and effect. How does immigration affect pay and employment levels? How does a longer education affect someone's future income? These questions are difficult to answer because we have nothing to use as a comparison. We do not know what would have happened if there had been less immigration or if that person had not continued studying.

However, this year's Laureates have shown that it is possible to answer these and similar questions using natural experiments. The key is to use situations in which chance events or policy changes result in groups of people being treated differently, in a way that resembles clinical trials in medicine.

Using natural experiments, David Card has analysed the labour market effects of minimum wages, immigration and education. His studies from the early 1990s challenged conventional wisdom, leading…
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