Three US-based economists win Economics Nobel Prize

Gulf Today Report

Three US-based economists have won the 2021 Nobel prize for economics for work on drawing conclusions from unintended experiments, or so-called "natural experiments.”

Canadian David Card, Israeli-American Joshua Angrist and Dutch-American Guido Imbens on Monday won the Nobel Economics Prize for insights into the labour market and "natural experiments", the jury said.

The researchers were honoured for providing "new insights about the labour market" and showing "what conclusions about cause and effect can be drawn from natural experiments", the Nobel committee said in a statement.

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Half of the 10-million-kronor ($1.1 million, one million euro) prize went to Card, a professor at the University of California, Berkeley, who was born in Canada in 1956, "for his empirical contributions to labour economics."

Card's work has focused on labour market effects of minimum wages, immigration and education.

A national library employee shows the gold Nobel Prize medal. File/AP

The other half went jointly to Angrist, 61, a professor at the Massachusetts Institute of Technology (MIT), and Imbens, 58, a professor at Stanford, "for their methodological contributions to the analysis of causal relationships."

They demonstrated how precise cause and effect conclusions can be.

The three laureates "have revolutionised empirical work in economics. They have shown that it's indeed possible to answer important questions, even when it's not possible to conduct randomized experiment," Nobel Comittee member Eva Mork told reporters in announcing the prize.

The trio was honoured for their work using so-called "natural experiments", in which "chance events or policy changes result in groups of people being treated differently, in a way that resembles clinical trials in medicine."

Last year, the honour went to US economists Paul Milgrom and Robert Wilson for their work on theories of auctions as well as inventing new auction formats.

The economics prize was the only prize not among the original five set out by the will of Swedish philanthropist and inventor Alfred Nobel, who died in 1896.

It was instead created through a donation from the Swedish central bank in 1968, and detractors have thus dubbed it "a false Nobel".