I am thrilled to share the news that the Royal Swedish Academy of Sciences has awarded the Sveriges Riksbank Prize in Economic Sciences to Guido Imbens for his work developing foundational methods to infer cause and effect. He shares the prize with Joshua Angrist of MIT, and David Card of UC Berkeley, who was recognized for his work in labor economics.
Guido Imbens, center-left, with his wife, Susan Athey, and three children | Credit: Andrew Brodhead
Guido Imbens is the Applied Econometrics Professor at Stanford GSB; professor of economics, Stanford School of Humanities and Sciences; and senior fellow at the Stanford Institute for Economic Policy Research (SIEPR). He is the fifth GSB faculty member to win the Nobel; Bob Wilson received the prize last year for his work on auction theory.
The tools for causal inference pioneered by Guido and colleagues have helped to ignite an empirical revolution in the social sciences, fueled by the vast amounts of data that are now available. The Nobel committee focused in particular on how causal relationships can be learned from “natural experiments:”
“Many of the big questions in the social sciences deal with cause and effect. How does immigration affect pay and employment levels? How does a longer education affect someone’s future income? These questions are difficult to answer because we have nothing to use as a comparison. We do not know what would have happened if there had been less immigration or if that person had not continued studying.
However, this year’s Laureates have shown that it is possible to answer these and similar questions using natural experiments. The key is to use situations in which chance events or policy changes result in groups of people being treated differently, in a way that resembles clinical trials in medicine.”
Please join me in congratulating Guido!