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Nobel-Prize-winning economist David Card GS ’83 discusses labor markets and Princeton influences

<h5>David Card, from his interview with U.C. Berkeley about his reception of half of the 2021 Nobel prize in economics</h5>
<h6>By Roxanne Makasdjian and Alan Toth for the University of California, Berkeley / <a href="https://commons.wikimedia.org/wiki/File:David_Card_-_Nobel_prize_interview_screenshot_(cropped).png" target="_self">Wikimedia Commons</a></h6>
David Card, from his interview with U.C. Berkeley about his reception of half of the 2021 Nobel prize in economics
By Roxanne Makasdjian and Alan Toth for the University of California, Berkeley / Wikimedia Commons

David Card GS ’83 won the 2021 Nobel Memorial Prize in Economic Sciences on Monday, along with Joshua Angrist GS ’89 and Guido Imbens. For the first time ever, five University affiliates have won a Nobel Prize in one year.

A graduate alumnus and former University faculty member, Card was awarded the Nobel “for his empirical contributions to labor economics.” His work has focused on minimum wage, immigration, and education. He is a leader in what is called the “credibility revolution,” a push to use more empirical evidence and experiments in economics.

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Card sat with The Daily Princetonian to discuss his prize, his career, and Princeton’s influence on his work. The following transcript has been edited for clarity and concision.

The Daily Princetonian: How do you find your time in New Jersey informing the way you think about your work today?

David Card: A few times I’ve been interviewed, and I’ve tried to point out that work that I did really came out of kind of a stream of work that was heavily influenced by Orley Ashenfelter in the Industrial Relations (IR) Section, which is the economics department. And Orley was my thesis advisor.

He recruited me to Princeton when I was going to go to grad school, and then, after grad school, I had a job at University of Chicago for just one year. And then they recruited me back to be an assistant professor. So, I spent a lot of time, a huge amount of time — I believe I might have been close to the record for the number of hours in Firestone Library because the IR section offices used to be on the first floor, A floor of Firestone Library.

DP: In the basement of Firestone library?

DC: I spent a lot of time there both, you know, interacting with Orley — Orley and I wrote some work in the early 1980s on training programs. These are programs for disadvantaged workers, where we kind of explored different ways of addressing how to figure out whether there was a causal effect of training programs. And I kind of adopted those ideas to some of the work that I was doing on immigration.

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I basically wrote this paper to say the truth and never thought it was going to go anywhere. I sent it to a very small journal, a labor specialty journal, and I never presented it at a conference or anything. And I thought it was kind of an interesting case study, but it kind of attracted some attention. And then I did some work on minimum wages.

Alan Krueger had, by then, joined the faculty at Princeton, and he had done some work with a former friend at Harvard, Larry Katz, on the minimum wages, and then the two of us were sitting in Firestone, in our offices, and Alan noticed there was a thing that the legislature had voted to raise the minimum wage. So, we got talking about how we could possibly do a good study. And, in a way, we were going to do a study that was a little different than you should have done in economics, because we were laying the groundwork for the analysis before the minimum wage actually occurred.

So definitely, I think, in all honesty, the whole field of labor economics being sort of revolutionized, people talk about, you know, revolution and credibility, revolution in economics, that really is coming out of Princeton.

DP: So, do you have any other particularly special Princeton memories that you hold dear, be they IR-related or otherwise?

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DC: Well, my wife has done a Ph.D. in music history. And, actually, music history had a seminar room down I think on maybe B Floor — and that was back in the day, when fellowships for grad students were just nothing, like a couple thousand a year, so she was always looking for temporary work, and she had a temp job at the IR section basically typing in papers and that’s where I met her. So, I owe my entire career and my wife to the IR section.

DP: Wow, so you’ve been away from Princeton now for some 20 years, 25 years. Do you have moments at Berkeley — or just going about daily life — where you feel old habits coming back, ways of thinking about things or notions that you really developed out here in suburban New Jersey that continue to inform the way you work today?

DC: Oh, I can tell you one thing I do that is kind of funny. So, I don’t know if students still work in the library, but, you know, for the long time I was there, many students worked in the library until late at night and, at a quarter to 12, the bells ring. And I always stop working at 11:45, kind of like a Pavlovian dog. You don’t even have to ring the bells anymore.

DP: That still happens.

DC: Oh, that’s good. Actually, Alan Krueger and I got locked in — we purposely used to hide in our office and then we could stay overnight. If we really had a deadline or something, we would do that.

DP: You would lock yourself in Firestone?

DC: Well, we would just sit back there quietly, and eventually we got permission. They sort of said “Okay, well, if you’re gonna do that, then just call this number” and the proctor came and let us out.

DP: So, before that, would you, if you stayed past when the library closed, would you not be able to get out until it opened again the next morning?

DC: Yeah, you got into trouble if you did. But you know, after one or two, it’s very quiet in there. Right?

DP: Yeah, I’m aware. I’ve been accidentally stuck in there before.

DC: Actually, lots of people have. It’s a very common Princeton experience.

DP: And then you went to teach at the University of Chicago.

DC: And you know, it was a pretty good job, except for one thing: I had to teach five courses a year. And Princeton called me up and said, ’Well, we’ve got an opening in labor economics. Would you consider coming back?’ And I thought, well, I don’t know. And then they said, well, they could cut me a special deal: I only had to teach two classes a year. Yeah, it was a good deal. So I did that.

DP: And now you are a Nobel Prize winner. How do you think about that?

DC: You know, it’s surprising. The work I did was many years ago. It’s kind of nice to think about. I worked with Alan Krueger, I worked with Orley, who’s still there. I worked with David Lee, who’s there. I worked with Alex Mas, who’s another professor there. David was one of my Ph.D. students. Alex was a Ph.D. student of Alan Krueger’s who came to Berkeley. Berkeley and Princeton are very closely connected. We basically started the West Coast outpost of the Princeton labor economics group.

Winning the Nobel Prize is sort of a certification. I think maybe it means more to other people because they know so much about it. My mom was very happy. All my old high school friends were like, I heard from them they were all excited. So, if you win the Nobel Prize, you’re sort of winning it for all these people that you’ve known — other grad students, and people I was co-authors with, and so on. Hopefully, there’s a little spillover for them.

DP: Do you have any thoughts you’d care to share with the broader undergraduate population?

DC: Well, I think I would say that Princeton was very good to me. I was not an undergraduate there. I was a grad student there. But, you know, I’m not from a rich family background. They paid for my Ph.D. I was always grateful for that. I think that they provide lots of opportunities. And I wish that they could find a way to provide that level of education for a much larger number of people. I think that’s the great tragedy of American higher education. We have these great institutions like Princeton or Harvard or Yale, but they can only provide slots for such a tiny number of people. Berkeley just by itself has way more people from disadvantaged backgrounds, Pell Grant students, than the Ivy League combined. So, it’s a great educational institution. I would say that I hope that the students there keep in mind that they’ve got this incredible privilege, and, hopefully, they can do something to try and expand that a bit in the future for other people.

DP: What was your background like growing up?

DC: My parents were dairy farmers on a small farm in Ontario. I’ve probably milked more cows than most people you’ve ever met.

DP: How do you see that upbringing as influencing where you are now, and especially your seminal work on minimum wage workers?

DC: I had many minimum wage jobs. I’ve worked in a couple of different factories, I worked for a steel company. And I wish more people had some of that experience, more academics. Because in all honesty, academia is full of people whose parents are Ph.D.s and have no idea what’s going on in the real world. And that causes some of the behavior that’s interpreted as elitism. I would say that, you know, one advantage of growing up on a dairy farm is that every other job that I ever have is better. You feel much better about it, no matter how crappy a job is, you say, well, at least this is better than milking cows.

DP: Do you think Princeton was a place that was receptive to people from a background like yours in the 80s?

DC: You know, in all honesty, when you’re 20 to 23 years old, you probably try not to let anybody know that you’re from a disadvantaged background. This is something you maybe still see. I remember, at the beginning of term, you know, Sept. 10, or whenever classes used to start, you would see the freshmen come in, and they would all be dressed differently. But within the year, everybody looked the same. So, it is homogenizing to a certain extent. So people, you know, they want to fit in.

Orley and I had a really good student, an undergrad student. Her name was Peggy Frisbie. And she was a really good undergrad in economics. And we really wanted her to go to grad school. But she felt she was, you know, not particularly poor, but not from a rich family in Central Florida. And so she went back to Florida and became a high school teacher, and she’s been doing that ever since. And she has an amazing website and students. So, she made a huge contribution to her community, without necessarily, you know, doing what people think of a Princeton career.

DP: Are there policy suggestions that you feel need stronger advocates?

DC: Now, that’s not really ever been my thing to tell you the truth. It might seem very strange to people, you know, “I mean, he does minimum wage and doesn’t do policy.” But I’ve never really been directly involved in policy. I think it’s much more important to try to understand how the labor market works, and why things are the way they are so that somebody else could design or think about better policies.

DP: Why isn’t policy your thing?

DC: Well, policy, at the end of the day, is mostly about normative things. And I think some people care about, you know, like, climate change, right? Climate change is a normative decision. And, in my view, it seems completely obvious that we should be doing an amazing amount, but other people think, “Well, okay, we don’t care, the future is bleak.” 

I don’t get that. But I know that that’s the way people are. For some reason, you know, a lot of these rich foundations fund anti-climate change things, so it seems like what’s going on is that there’s a lot of these people that believe that it doesn’t really matter if the Earth becomes uninhabitable. You know, if that’s what they believe, there’s not really anything I can do to fix that.

I can tell you, when I started working on the minimum wage back then, most liberals and centrists were opposed to the minimum wage. It used to be that most textbooks, even from professors at Princeton, they were kind of at best ambivalent, and probably more likely to sort of say, “Well, probably the minimum wage is a bad idea.” So, at that time, the centrists all believed the minimum wage was a bad idea, because they had this view of how the labor market worked. So, I think Alan [Krueger] and my work really did move that a little bit.

DP: Is there anything else that you’d like to tell the Princeton community, any last memory or shout out you’d like to get down?

DC: No, I guess I just express my thanks to Princeton. It’s been — as I said, it has been good to me. I hope I was able to give back some of that.

Sam Kagan is a Staff Writer and News Editor Emeritus at the ‘Prince.’ He also leads the surveys team. He can be reached at skagan@princeton.edu.

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