Two Bay Area professors were jolted awake early Monday morning by phone calls from Sweden announcing perhaps the greatest professional achievement of their lives: a Nobel prize. One of them, however, at first imagined he was being pranked by a high school buddy before the happy reality set in.
UC Berkeley professor David Card was awarded one half of the Nobel prize for economics for his research on how minimum wage, immigration and education affect the labor market. Guido Imbens of Stanford University shared the other half with Joshua Angrist from the Massachusetts Institute of Technology for their framework for studying issues that can’t rely on traditional scientific methods.
“It’s really building on the contributions of so many people,” a shell-shocked Card said during an early morning video conference with university leaders.
Imbens, who acknowledged he’d had an “exciting, somewhat disorienting morning,” hailed his fellow awardees in a separate webcast across the bay.
“Their work has always been a great source of inspiration,” he said, recalling how long discussions with Angrist years ago at a Harvard University laundromat on Saturday mornings laid the basis for much of the research for which the pair are now recognized. “I couldn’t be more thrilled to share the prize with him.”
UC Berkeley now counts 10 Nobel laureates among its faculty and Stanford is home to 20 living Nobel laureates.
And this is the second Nobel prize in economics in as many years for Stanford. Last year Stanford economists Paul Milgrom and Robert Wilson won for their work to improve auction theory and their invention of new auction formats.
Canadian-born Card was honored Monday for pioneering research that showed an increase in minimum wage does not lead to less hiring and immigrants do not reduce pay for native-born workers, challenging commonly held ideas.
Good morning to 2021 economic sciences laureate David Card!
Card’s wife Cynthia Gessele snapped this photo of him speaking to #NobelPrize’s Adam Smith (which he suspected might be a made-up name) right after he had heard the news.
Listen to our interview, coming soon. pic.twitter.com/I93bJwikGl
— The Nobel Prize (@NobelPrize) October 11, 2021
Card looked at what happened when New Jersey raised its minimum wage in 1992 from $4.25 to $5.05, using restaurants in bordering eastern Pennsylvania as a comparison group.
He and his late research partner Alan Krueger found, contrary to previous studies, that an increase in the minimum wage had no effect on the number of employees. Card later did further work on the issue. Overall, the research concluded that the negative effects of increasing the minimum wage are small and significantly smaller than believed 30 years ago, the Nobel committee said.
Card also found that incomes of those who are native born to a country can benefit from new immigrants, while immigrants who arrived earlier are the ones at risk of being negatively affected.
Imbens won for working out the methodological issues that allow economists to draw solid conclusions about cause and effect even where they cannot carry out studies according to strict scientific methods.
The Royal Swedish Academy of Sciences said the three have “completely reshaped empirical work in the economic sciences.”
UC Berkeley Chancellor Carol Christ praised Card for challenging conventional wisdom, calling the practice “part of Berkeley’s DNA” and one that leads to new knowledge. In accordance with tradition, she promised Card a highly coveted designated parking space near his office — but said the university might have to work out a special spot for his bike instead, since she’d been informed he usually cycles to work.
Shachar Kariv, chair of the economics department at Cal, praised Card as a “teaching ninja” who repeatedly won a best adviser award from doctoral students before they adopted a no-repeat rule.
“Dave loves his work,” Kariv said. “It shows, and it’s contagious.”
Card, who joked that he thought the initial call from Sweden was a prank pulled by a friend he met in ninth grade English, said working at UC Berkeley has been rejuvenating.
“There’s a continuing flow of new ideas and new people and people that are enthusiastic and really want to learn and push the frontiers in many different directions,” he said.
Speaking by phone from his home, Imbens told reporters that he had been asleep “after a busy weekend” when the call came.
“I was just absolutely stunned then to get a telephone call,” he said. “And then I was just absolutely thrilled to hear the news … that I got to share this with Josh Angrist and and David Card.”
The Dutch-born Imbens said Angrist was best man at his wedding.
Stanford President Marc Tessier-Lavigne praised Imbens’ work for providing an important tool for understanding the impact of different interventions as society grapples with thorny issues like economic and educational inequities.
The university is “incredibly proud of Professor Imbens,” Tessier-Lavigne said.
Imbens said he was grateful to earn the prize while his children — including a high school senior — are still young enough to be living at home.
“It was just really nice to be able to celebrate this with my children and my wife,” he said.
Say hello to one happy family!
New economic sciences laureate Guido Imbens (centre) celebrates the news with his family in their garden early this morning.#NobelPrize pic.twitter.com/XrogDGWHYu
— The Nobel Prize (@NobelPrize) October 11, 2021
The award comes with a gold medal and 10 million Swedish kronor (over $1.14 million).
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, with the first winner selected a year later. It is the last prize announced each year.
Last week, the 2021 Nobel Peace Prize was awarded to journalists Maria Ressa of the Philippines and Dmitry Muratov of Russia for their fight for freedom of expression in countries where reporters have faced persistent attacks, harassment and even murder. And UC San Francisco professor David Julius and Ardem Patapoutian, a molecular biologist and neuroscientist at Scripps Research in La Jolla shared the Nobel in medicine for finding the sites in our cells that signal temperature, pain and pressure, providing a roadmap for the design of better medicines.
Asked what he had planned for the rest of the day, Imbens said he was scheduled to teach an afternoon seminar. Watching students learn and grow, he said is an “incredible privilege.”
Card also praised his students and said the prize — based on work decades in the making — should serve as a reminder about the power of teamwork.
“Think of this,” he said, “as a victory for the team.”
The Associated Press contributed to this report.
