This year's Nobel Prize in Economic Sciences was awarded to David Card for his empirical contributions to labor economics and to Joshua Angrist and Guido Imbens for their methodological contributions to the analysis of causal relationships.

Card, Class of 1950 Professor of Economics at University of California, Berkeley, was named Monday morning along with Angrist, Ford Professor of Economics at MIT, and Imbens, the Applied Econometrics Professor and Professor of Economics at the Stanford University Graduate School of Business, as the 2021 recipients of the award from The Royal Swedish Academy of Sciences. Card, the current AEA President and a former coeditor of the American Economic Review, was awarded the John Bates Clark Medal in 1995, and Imbens was a member of the AEA Executive Committee from 2014–2016.

David Card

Joshua Angrist

Guido Imbens

Using natural experiments, Card analyzed the effects of minimum wages, immigration, and education on labor markets. In particular, his studies from the early 1990s challenged conventional wisdom at the time. One surprising insight from this work showed, among other things, that increasing the minimum wage does not necessarily lead to fewer jobs.

Data from natural experiments, however, are often difficult to interpret. In the mid-1990s, Angrist and Imbens helped solve these methodological problems, demonstrating how to draw precise conclusions about cause and effect from natural experiments.

“Card’s studies of core questions for society and Angrist and Imbens’ methodological contributions have shown that natural experiments are a rich source of knowledge. Their research has substantially improved our ability to answer key causal questions, which has been of great benefit to society,” said Peter Fredriksson, chair of the Economic Sciences Prize Committee.

The announcement can be read here: https://www.nobelprize.org/prizes/economic-sciences/2021/press-release/.