The award-winning economists have completely transformed the analysis of empirical evidence in economics

It was explained by a local researcher who specializes in social, distribution and labor issues The winners are three researchers with the longest experience in analyzing issues related to the labor economy And they are considered to be included in the same award because all three have made the most important contributions, complementing and reinforcing each other. “Basically a common feature of the research presented to them is related to the emphasis placed on empirical research in the so-called natural sciences, the natural sciences,” de Capua explained.

In that sense, there is a lot of evidence that a sociologist faces the inability to use economic science, laboratory experiments, or clinical trials, and that it is often difficult to look at observational data to confirm various theoretical models. .

What are these natural experiments about?

They are real life situations that allow us to identify causal consequences. In economics we always make an important distinction between relationships or associations of different variables. We understand whether they are collectively cohesive, but we do not necessarily notice that there is a causal effect in this type of relationship. There may be other factors at times that explain why the two variables behave the same way. Precise use of the existence of natural experiments caused by random events, or rules, economic policies, the consequences of some of these events and the possibility of comparing what happened when it happened. . Done. Ideally, compare what would have happened to an object of that accident or regulatory change.

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On what is the research of Nobel Laureates based?

In the case of Gardiner, his first works were co-authored with the late Alan Krueger. He was awarded for his empirical research on the effects of increased wages since the 1990s. Other studies relate to the impacts of migration on the labor markets of countries receiving migrant flows of foreign workers. Also, how allocating educational resources to different schools affects people’s employment opportunities. The paper on the minimum wage is related to the change in the state of New Jersey in the early 90s, where it was increased. The card explores the event and the impact it will have on the job market. Traditionally, the right competition models understand that the minimum wage increase creates unemployment. What David did was compare what happened when the minimum wage was increased in New Jersey to the border state of Pennsylvania. The changes that take place between these two peoples in the labor market will only be due to that regulatory issue. Finally, he found that, contrary to what he usually expected, the minimum wage increase did not cause much unemployment among workers. Then, some possible explanations emerged, perhaps the companies’ price increase shifted to the prices of the end products without having much impact on demand, and the potential presence of markets with asymmetricity in bargaining power. This study was done on fast food restaurant chains, which generally have the bargaining power of workers as contractors. But he concluded that this type of regulation would not lead to an increase in unemployment, but rather, it would lead to more workers deciding to join the workforce. This is very revolutionary, because raising the minimum wage has called into question the conference that has existed so far in a way that could negatively affect employment.

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Members of the Swedish Academy at the time of announcing this year’s winners.

Did you come to any conclusions regarding immigration?

In this case, Fidel Castro allowed all the people who wanted to leave Cuba, in a strange event, in April 1980, which led to the trial. This created an unprecedented wave of Cuban immigrants, especially to the city of Miami. It is estimated that the labor force in Cuba increased by 7% between May and September 1980 as a result of the severe immigration caused by the move. The question that is always explored in these immigration issues is whether immigration creates a fall in wages and unemployment for locals. It does not generally study the countries or cities that receive immigrants because the comparison there is not valid. Comparing locations with high immigration rates and low immigration rates does not lead to reliable results because control and treatment groups are incomparable, they have different dynamics in the labor markets. On the other hand, since it arose as a random event in history, it allowed this experiment to be carried out and the results analyzed taking into account the validity of the findings.

What is an invention?

Contrary to expectations, it was found that this situation may have had an impact on previously immigrant populations, but not necessarily to the local population from that settlement. Some interpretation that has been woven over the years is that these waves of immigrants tend to specialize in jobs that require more proficiency in the native language, as do the locals with similar qualifications. Finally, they are not competing for the same jobs, but rather there is a category and difference of employment among immigrants and locals, which tends to find educational level.

Both the immigration issue and the minimum wage issue are very current issues. Would it have affected the awards?

Undoubtedly these are controversial issues today and undoubtedly it could have been a bit to do with the researchers ’awards. However, it is related to the economic sciences and to the analysis of education and public policy. I do not want to fail to mention Joshua Angrist. His contributions are a little more methodical. The serious nature of these investigations has led to pioneering work in establishing a full-fledged research in the economic sciences, which seeks to reinforce the creation of empirical evidence. They propose to make assumptions about how to evaluate observational data explicitly and explicitly, which has a lot to do today, as we generally have more access to data, results and empirical data. These researchers have precisely laid the foundation for a whole line created over the last 30 years, which is related to empirical analysis but is supported by solid and solid methodological components. How to advance knowledge by analyzing empirical evidence is revolutionary, using coexistent, coherent and robust methods that may contain other types of science, by their very nature, a test for an experiment that can control every element.

Natural experiments have received some criticism, and why?

Criticism would probably come if the data relied solely on one aspect of the problems associated with the scale measurements of this event. In fact, the fertile thing is that the event can be approached with a broader perspective. I do not think one should blindly oppose or support any method. The rich thing is that you can combine different events and different ways of approaching social events with different tools. Criticisms had to be made of the fact that there was a bias towards a quantitative approach to social events, in fact there must be another element that contributes to the analysis of these issues, in a more comprehensive way, with the more standard forms or other sciences, in a more comprehensive way.