NOBEL PRIZE FOR ECONOMIC SCIENCES, 2021

  • The 2021 Nobel Prize in Economic Sciences has been awarded in one half to Canadian-born David Card and the other half jointly to Israeli-American Joshua D Angrist and Dutch-American Guido W Imbens.
  • David Card has been awarded for his empirical contributions to labour economics. Joshua D Angrist and Guido W Imbens won the award “for their methodological contributions to the analysis of causal relationships.”
  • The 2020 Nobel Prize in Economic Sciences was awarded to Paul R Milgrom and Robert B Wilson “for improvements to auction theory and inventions of new auction formats”.

Important points:

Unlike the other Nobel prizes, the economics award wasn’t established in the will of Alfred Nobel but by the Swedish central bank in his memory in 1968.

David Card:

  • He has analysed how minimum wages, immigration and education impact the labour market.
  • One of the significant findings of this research was that “increasing the minimum wage does not necessarily lead to fewer jobs”.
  • It also led to the understanding that “people who were born in a country can benefit from new immigration, while people who immigrated at an earlier time risk being negatively affected”.
  • It also illuminated the role of resources available in school in shaping the future of students in the labour market.

Joshua Angrist and Guido Imbens:

  • They were rewarded for their “methodological contributions” to the research tool.
  • Their work demonstrated “how precise conclusions about cause and effect can be drawn from natural experiments”.

SOURCE: THE HINDU,THE ECONOMIC TIMES,MINT

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