Overview
David Card is Class of 1950 Professor of Economics at the University of California, Berkeley, and a Research Associate at NBER. He shared the 2021 Nobel Memorial Prize in Economic Sciences with Joshua Angrist and Guido Imbens for empirical contributions to the analysis of causal relationships in labor economics. Card is a central figure in the credibility revolution, having produced landmark natural experiment studies of minimum wages, immigration, school quality, and returns to education. He co-edited multiple volumes of the Handbook of Labor Economics with Orley Ashenfelter.
Key Contributions / Features
- Returns to schooling (Card 1993/1995, 1999): Used college proximity as an instrument for educational attainment (NLS Young Men sample), finding IV substantially above OLS and heterogeneous effects by family background — college proximity has larger effects for children of less-educated parents. The 1999 handbook chapter (Chapter 30, Handbook of Labor Economics vol. 3A) synthesizes the full identification literature: formalizes the OLS bias decomposition (plim(b_OLS) = β̄ + λ₀ + φ₀S̄), shows that ability bias is only ~10%, and explains IV > OLS as evidence that financially constrained compliers have higher marginal returns, not as upward IV bias. See Returns to Schooling.
- Minimum wages (Card and Krueger 1994): DiD study using Pennsylvania fast-food restaurants as a control group for the 1992 NJ minimum wage increase; found no negative employment effect. A central example of Difference-in-Differences with two comparison groups. Co-authored with Alan Krueger.
- School quality (Card and Krueger 1992a,b): Estimated returns to schooling for cohorts by state of birth; showed that reducing the pupil-teacher ratio by 10 students raises the causal return to education ~0.9 pp and raises average attainment 0.6 years. Provides the parameter k — slope of marginal benefits of schooling with respect to school quality — used to calculate the endogeneity bias component in the OLS estimator.
- Immigration (Card 1990, Mariel Boatlift): Used the 1980 influx of Cuban migrants as a natural experiment for labor supply in Miami; found no measurable effect on wages or unemployment for Miami workers, contradicting the wage-depression prediction of the competitive model.
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