Heterodox
The Sveriges Riksbank prize in economic sciences in memory of Alfred Nobel this year goes to David Card, Joshua Angrist, and Guido Imbens. I cannot say much about instrumental variables, Angrist, or Imbens. Since I have been pointing to Card's work with Alan Krueger on minimum wages for decades, I thought I might say somthing about his half of the prize. I do not have much new to say. I find both natural experiments and meta-analysis intriguing. Both Card and Krueger's natural experiments with minimum wages and their meta-analysis have been superceded. Maybe 'transcended' or 'replicated' would be better terminology. That is why, in my 2019 paper in Strucutral Change and Economic Dynamics, I reference Andrajit Dube and his colleagues, not Card and Krueger. Also, David Neumark's
Topics:
Robert Vienneau considers the following as important: Labor Markets
This could be interesting, too:
Robert Vienneau writes Wages, Employment Not Determined By Supply And Demand
Robert Vienneau writes The Emergence Of The Reverse Substitution Of Labor
Robert Vienneau writes Reminder: Wages, Employment Not Determined By The Supply And Demand Of Labor
Robert Vienneau writes The Emergence Of The Reverse Substitution Of Labor
The Sveriges Riksbank prize in economic sciences in memory of Alfred Nobel this year goes to David Card, Joshua Angrist, and Guido Imbens. I cannot say much about instrumental variables, Angrist, or Imbens. Since I have been pointing to Card's work with Alan Krueger on minimum wages for decades, I thought I might say somthing about his half of the prize.
I do not have much new to say. I find both natural experiments and meta-analysis intriguing.
Both Card and Krueger's natural experiments with minimum wages and their meta-analysis have been superceded. Maybe 'transcended' or 'replicated' would be better terminology. That is why, in my 2019 paper in Strucutral Change and Economic Dynamics, I reference Andrajit Dube and his colleagues, not Card and Krueger. Also, David Neumark's quibbles with Card are currently uninteresting. (Any reporter talking to Neumark should note he started out with funding from a consortium of fast food joints.)
I object to attempts to explain the lack of impact of minimum wages on employment by the theory of monopsony. Economists have known, for over half a century, that wages and employment cannot, even under ideal conditions, be explained by the interaction of well-behaved supply and demand curves in the labor market. In marginalist theory, the supply of labor is derived from utility-maximizing households trading off leisure and commodities to consume. The demand for labor is supposed to be derived from profit-maximizing firms. But no such valid derivation goes through if firms produce some commodities with the use of previously produced commodities, that is, capital goods. This well-established result is widely ignored, with no pretence at justification.