It's important to stress that today's Nobel was notably *not* only a "methods" award; that was only 1/2. The other 1/2 going to Dave Card was for his contribution to helping understand how the labor market works, esp on minimum wages, immigration, and education.

1/
On minimum wage, the Scientific Background document does a very good job explaining both the contributions of Card and Krueger, and how they compare and relate to subsequent work (pp. 13-19).

Highly recommended for all those interested in the topic.

2/

nobelprize.org/uploads/2021/1…
The discussion also highlights how the idea of labor market monopsony - which was dismissed out of hand at the time when Myth and Measurement came out - is on it's way to becoming standard economics.
3/
This is why again the award was not just for "empirical methods."

Instead it was a recognition of something Alan Krueger once said to me on here: “The idea of turning economics into a true empirical science, where core theories can be rejected, is a BIG, revolutionary idea.”

4/
As Dave said in his characteristically humble interview, a key reason why CK94 was controversial was the difficulty at that time in accepting the idea that employers have some discretion in wage setting ("monopsony power"). That's changed esp recently.


5/
In contrast, in the past 5 years especially, there have been lots of theoretical and empirical work that speak to each other about labor market power, and have helped shed light on important aspects ranging from gender or racial wage gaps, inequality, min wage, etc.
6/

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More from @arindube

12 Oct
Card and Krueger 94 was criticized for many things: data quality (survey), short pre-post period, inference (single case study).

Let's see how these played out.

1/
The data quality argument aged really poorly. In part, because the data used to make the data quality argument (NW 2000) itself had demonstrable problems, and CK 2000 reply used the universe of payroll data (ES-202, now known as QCEW).

CK 2000 confirmed lack of job loss.

2/
Also, DLR 2010, generalizing CK 00 using border county approach but with all borders and QCEW payroll based data, largely confirmed the findings of CK 00.
direct.mit.edu/rest/article/9…

3/
Read 8 tweets
12 Oct
Let me take this time to correct a misperception.

Our QJE paper was *not* mostly based on "small" min wage changes. The average size of a particular *increment* we studied was around 10%, but state increases almost always have multiple increments.
1/
So a variety of minimum wage changes at the state level that we studied had >30% increase which other researchers elsewhere call "large."

We also show evidence including *federal increases* including from the last increase which was a 41% increase.
2/
Importantly, we specifically look at how the marginal impact may have differed when considering events where the minimum wage had a MUCH BIGGER bite. Going up to minimums at ~55% of the median wage, we found no employment effects, even as wage effects were much larger.

3/
Read 5 tweets
11 Oct
My UK review is informative because it's the only one that focuses on the own-wage elasticity of min wage. Without that, magnitudes are not very useful.

We'll have updated version of the UK OWE review soon!
Own-wage elasticity (OWE) of employment:

Read 4 tweets
1 Oct
No one cares about your or my preferences on what should be done with $1.5T vs of $3.5T over 10 years.

Real news is that Dems are finally hashing it out to get to a reconciliation bill. That will involve public and private fights & haggling. It's happening. Not pretty but good.
This is a perfectly reasonable, if contentious, process through which progressives and moderates eventually come to a compromise.

Grandstanding, threats, arguments, followed by a likely eventual compromise.

That's normal politics.

Contrary to GOP/Dem politics, pretty sure intra-Dem politics will not leave money on the table (i.e. fail to agree on mutually advantageous policies) due to ideological vitriol.

It'll be acrimonious, but eventual agreement happens when there is common knowledge on relaive power.
Read 4 tweets
22 Sep
This post by @Lauren_Farre11 is getting dunked.

But it's not bad to interrogate what words like "objective" and "rigorous" actually mean IRL.

Do they really mean the findings are solid? Or do researchers lean on those buzzwords to market their arguments?
urban.org/urban-wire/equ…
I think the blog post is probably being mis-interpreted because it didn't put quotes around "objective" and "rigorous."
Now let me be very clear.

I'm a dyed-in-the-wool empiricist, and a strong believer in evidence-based reasoning.

But I also appreciate the point that that claims of objectivity have historically been made strategically to sometimes promote outcomes that have harmed many people.
Read 4 tweets
22 Sep
There is no way forward to making America safe without reforming the FDA.
I have heard my molecular biologist parents complain about the FDA bureaucracy for years.

Now I believe them.
The Defense Procurement Act is great. Should be used a lot to fight the pandemic.

But here it's trying to solve problems created by FDA rules preventing access to cheap rapid tests, which are 1) available elsewhere, 2) vital to returning to a semblance of normalcy even with vax.
Read 4 tweets

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