Connect with us

News

3 US-based economists win Nobel for research on wages, jobs

Published

on

3 US-based economists win Nobel for research on wages, jobs

By CHRISTOPHER RUGABER, DAVID McHUGH and DAVID KEYTON

STOCKHOLM (AP) — A U.S.-based economist won the Nobel prize in economics Monday for pioneering research that transformed widely held ideas about the labor force, showing how an increase in the minimum wage doesn’t hinder hiring and immigrants don’t lower pay for native-born workers. Two others shared the award for developing ways to study these types of societal issues.

Canadian-born David Card of the University of California, Berkeley, was awarded half of the prize for his research on how the minimum wage, immigration and education affect the labor market.

The other half was shared by Joshua Angrist of the Massachusetts Institute of Technology and Dutch-born Guido Imbens of Stanford University for their framework for studying issues that can’t rely on traditional scientific methods.

The Royal Swedish Academy of Sciences said the three “completely reshaped empirical work in the economic sciences.”

Together, they helped rapidly expand the use of “natural experiments,” or studies based on observing real-world data. Such research made economics more applicable to everyday life, provided policymakers with actual evidence on the outcomes of policies, and in time spawned a more popular approach to economics epitomized by the blockbuster bestseller “Freakonomics,” by Stephen Dubner and Steven Levitt.

In a study published in 1993, Card looked at what happened to jobs at Burger King, KFC, Wendy’s and Roy Rogers when New Jersey raised its minimum wage from $4.25 to $5.05, using restaurants in bordering eastern Pennsylvania as the control — or comparison — group. Contrary to previous studies, he and his late research partner Alan Krueger found that an increase in the minimum wage had no effect on the number of employees.

Card and Krueger’s research fundamentally altered economists’ views of such policies. As noted by the Economist magazine, in 1992 a survey of the American Economic Association’s members found that 79% agreed that a minimum wage law increased unemployment among younger and lower-skilled workers. Those views were largely based on traditional economic notions of supply and demand: If you raise the price of something, you get less of it.

By 2000, however, just 46% of the AEA’s members said minimum wage laws increase unemployment, largely because of Card and Krueger.

Their findings sparked interest in further research into why a higher minimum wouldn’t reduce employment. One conclusion was that companies are able to pass on the cost of higher wages to customers by raising prices. In other cases, if a company is a major employer in a particular area, it may be able to keep wages particularly low, so that it could afford to pay a higher minimum, when required to do so, without cutting jobs. The higher pay would also attract more applicants, boosting labor supply.

Their paper “has shaken up the field at a very fundamental level,” said Arindrajit Dube, an economics professor at the University of Massachusetts, Amherst. “And so for that reason, and all the following research that their work ignited, this is a richly deserved award.”

Krueger would almost certainly have shared in the award, Dube said, but the economics Nobel isn’t given posthumously. Krueger, Imbens said, co-authored papers with all three winners.

Krueger, who died in 2019 at age 58, taught at Princeton for three decades and was chief Labor Department economist under President Bill Clinton. He also was Obama’s chairman of the Council of Economic Advisers.

Card and Krueger’s paper made a huge impact on other economists. Lisa Cook, an economics professor at Michigan State University, said their paper was “a revelation” that helped crystallize her thinking for her research on racial violence in the late 19th and early 20th centuries and how it inhibited patent filings by Black Americans.

Card’s research also found that an influx of immigrants into a city doesn’t cost native workers jobs or lower their earnings, though earlier immigrants can be negatively affected.

Card studied the labor market in Miami in the wake of Cuba’s sudden decision to let people emigrate in 1980, leading 125,000 people to leave in what became known as the Mariel Boatlift. It resulted in a 7% increase in the city’s workforce. By comparing the evolution of wages and employment in four other cities, Card discovered no negative effects for Miami residents with low levels of education. Follow-up work showed that increased immigration can have a positive impact on income for people born in the country.

Angrist and Imbens won their half of the award for working out the methodological issues that allow economists to draw solid conclusions about cause and effect even where they cannot carry out studies according to strict scientific methods.

Card’s work on the minimum wage is one of the best-known natural experiments in economics. The problem with such experiments is that it can be difficult to isolate cause and effect. For example, if you want to figure out whether an extra year of education will increase a person’s income, you cannot simply compare the incomes of adults with one more year of schooling to those without.

That’s because there are many other factors that might determine whether those who got an extra year of schooling are able to make more money. Perhaps they are harder workers or more diligent and would have done better than those without the extra year even if they did not stay in school. These kinds of issues cause economists and other social science researchers to say “correlation doesn’t prove causation.”

Imbens and Angrist, however, figured out how to isolate the effects of things like an extra year of school. Their methods enabled researchers to draw clearer conclusions about cause and effect, even if they are unable to control who gets things like extra education, the way scientists in a lab can control their experiments.

Imbens, in one paper, used a survey of lottery winners to evaluate the impact of a government-provided basic income, which has been proposed by left-leaning politicians in the U.S. and Europe. He found that a prize of $15,000 a year did not have much effect on a person’s likelihood to work.

Card said he thought the voice message that came in at 2 a.m. from someone from Sweden was a prank until he saw the number on his phone really was from Sweden.

He said he and his co-author Kreuger faced disbelief from other economists about their findings. “At the time, the conclusions were somewhat controversial. Quite a few economists were skeptical of our results,” he said.

Imbens’ wife, Susan Athey, is also an economist and president-elect of the AEA, and Imbens said they sometimes argue about economics in front of their three children.

“This means, I hope, they’ll learn that they need to listen to me a little bit more,” he said. ”I’m afraid it probably won’t work out that way.”

At home in Brookline, Massachusetts, Angrist said: “I can hardly believe it. It’s only been a few hours and I am still trying to absorb it.”

He also missed the call from Nobel officials and awoke to a torrent of texts from friends. Fortunately, he said, he knew enough other Nobel Laureates that he got a callback number from them.

As a youth, Angrist dropped out of a master’s program in economics at Hebrew University in Israel, although he did meet his future wife, Mira, there. He has dual U.S. and Israeli citizenship.

“I did have sort of a winding road,” he said. “I wasn’t a precocious high school student.”

The award comes with a gold medal and 10 million Swedish kronor (over $1.14 million).

Unlike the other Nobel prizes, the economics award wasn’t established in the will of Alfred Nobel but by the Swedish central bank in his memory in 1968, with the first winner selected a year later. It is the last prize announced each year.

—-

Rugaber reported from Washington and McHugh reported from Frankfurt, Germany.

—-

Read more about Nobel Prizes past and present by The Associated Press at https://www.apnews.com/NobelPrizes

google news

News

Supply of homes for sale dried up in November across metro Denver

Published

on

Supply of homes for sale dried up in November across metro Denver

Snow wasn’t the only thing missing in metro Denver in November. Home listings dried up, with the inventory of available properties down by a third from October. The shortage is so severe that single-family home prices revisited record highs reached this summer, according to a monthly update from the Denver Metro Association of Realtors.

There were 1,444single-family homes for sale at the end of November, down 38.4% from October and 17.7% from a year earlier. The supply of condos and townhomes fell 21.6% month-over-month and 51.6% on the year to 804 listings. Normally, the inventory of homes for sale drops 11.4% between October and November, and last month’s decline was one for the record books, DMAR said.

November’s inventory was also a record low for the month, according to the report. If December sees a 25% drop in inventory from November, metro Denver could end the year with a paltry 1,686 active properties, noted Andrew Abrams, chairman of the DMAR Market Trends Committee, which compiles the monthly report.

“That is drastically lower than the end of 2020 and could lead to the most competitive year yet,” he said in comments included with the report, adding that 2021 homes sales are on track to surpass annual sales seen in any year in the past five years.

A nearly 30% drop in new listings compared to October contributed to the inventory shortages, but new listings last month were on par with November 2020. Demand remains strong, with 4,392 closings but only 3,741 new listings hitting the market. Closings were down 10.4% from October, but that appears to be more about a lack of homes to buy. Half of new listings went under contract in five days or less after hitting the market.

google news
Continue Reading

News

Developers planning Denver apartments pay $11.7 million for Golden Triangle site

Published

on

Developers planning Denver apartments pay $11.7 million for Golden Triangle site

A pair of development firms planning a large apartment complex in the Golden Triangle have purchased the land.

Denver-based Summit Capital Venture Group and New York-based Rockefeller Group paid about $11.7 million across four separate deals this week for parcels at the southeast corner of 12th Avenue and Delaware Street, according to public records.

The parcels — 328 W. 12th Ave. and 1140, 1150 and 1158 N. Delaware St. — add up to 0.72 acres, according to property records. That makes the collective deal worth about $373 a square foot for the land. Travis Hodge and Tony Bobay of Capstone represented the seller in two of the transactions.

Summit and Rockefeller said in a statement that they plan to build a 13-story, 250-unit apartment complex with about 2,000 square feet of ground-floor retail space.

“With the current focus on the redevelopment of the Golden Triangle area, this was an ideal opportunity to launch a partnership with Rockefeller Group,” Jason Marcotte, a founding partner at Summit Capital Venture Group, said in a statement. “We are excited to further enrich the neighborhood with quality housing options and thoughtful retail activation at the street level.”

The properties are home to multiple structures, including an office building at 1140 Delaware St. used by and sold by the Junior League of Denver.

The site is home to multiple structures, including an office building used by the Junior League of Denver. (Thomas Gounley photo)

“Our plan is to find another stand-alone building that is right for our purposes,” Junior League President Caryne Mesquita told BusinessDen Thursday. “We are in the process of looking at buildings right now. As we look at the market, we’re finding there aren’t many out there. We may be doing a short-term lease to give us time. We still want a Denver address, somewhere in the Central Business District or a little bit farther south. But probably not right in the middle of downtown.”

Rockefeller and Summit’s project is expected to break ground in April and be completed in early 2024, according to the companies.

Summit has 466 multifamily units in development, and owns another 174 units between Denver and Salt Lake City that it acquired, according to the company. Rockefeller, meanwhile — whose top local executive is Jay Despard, formerly of Hines — is one of the two firms that owns the former Greyhound block in downtown Denver.

The Golden Triangle has become a hub for significant multifamily development in recent years, and changes approved by the Denver City Council this summer paved the way for taller buildings.

Major developers active in the neighborhood include Denver-based Urban Villages, Charlotte-based Lennar Multifamily Communities and Charleston, South Carolina-based Greystar.

BusinessDen reporter Eric Heinz contributed to this story.

google news
Continue Reading

News

A battle between pedaling and peace heats up over plans for mountain bike park in Conifer

Published

on

A battle between pedaling and peace heats up over plans for mountain bike park in Conifer

CONIFER — A titanic battle of Colorado values and priorities is brewing over a proposed mountain bike park on a 9,000-foot mountain overlooking this quiet foothills community 40 minutes from Denver.

On one side are the thousands of cyclists who take to the state’s roads and trails every day, seeking the thrill and challenge of rolling across world-class terrain amid jaw-dropping settings. On the other are long-time mountain residents, adamant about keeping Colorado’s relentless growth at bay while protecting a peacefulness and quietude that is increasingly under strain.

The battle lines in this faceoff are drawn on a heavily wooded 250-acre parcel along Shadow Mountain Drive just west of Conifer, where a plan to build Colorado’s first dedicated lift-access mountain bike park — with 16 miles of trails and an 830-foot vertical drop spanned by a chairlift — has resulted in dueling campaigns for and against it.

A Change.org petition in support of the project has gathered nearly 2,500 signatures while an effort to stymie the plan has garnered around 4,400 signatures.

John Lewis, a member of a well-organized group fighting the proposed project, said he and his neighbors are ready for the Full Send Bike Ranch proposal to land in front of the Jefferson County Planning Commission. The men behind the project say that could come as early as next month, with a hoped-for opening in 2023 should the county give its blessing.

Lewis last week pointed to a vast slope of evergreen trees fronted by North Turkey Creek burbling through a sun-dappled mountain meadow as natural features he doesn’t want to see degraded or disturbed by the construction of a downhill mountain bike facility with a 300-space parking lot.

He worries about hundreds of vehicles traversing narrow Shadow Mountain Drive every day, negotiating blind curves and racing past driveways to reach the bike park. He worries about impacts to wildlife and to the bucolic views he and his neighbors have enjoyed for decades.

He also worries about an increase in wildfire danger — a flicked cigarette from a moving car, perhaps — to an area that is already tinder dry.

“It’s just not appropriate for a residential area,” Lewis said, driving his truck several miles up Shadow Mountain Drive and passing dozens of signs denouncing the project. “I don’t mind these guys building their bike park — but why here?”

Hyoung Chang, The Denver Post

Ranch near the corner of Shadow Mountain Drive and South Warhawk Road. in Conifer, Colorado on Friday, December 3, 2021. Full Send Bike Ranch will be a 250-acre lift access downhill mountain bike park at the area. (Photo by Hyoung Chang/The Denver Post)

“Just about the riding”

“These guys” are Jason Evans and Phil Bouchard, lifelong friends and bike aficionados from New Hampshire who moved to Colorado last year just as the COVID-19 pandemic was descending on the state. Bouchard, who describes himself as the “strategy” side of the Full Send operation, defends the project as a net gain for the Conifer area.

He said he and his business partner will be working with the U.S. Forest Service to do major wildfire mitigation on the site, removing dead and down trees to make it far safer than it is now. And he said the Full Send Bike Ranch will help draw cyclists off other trails in the area that are currently overcrowded.

“We think the park will alleviate a bit of pressure on a lot of trail systems,” Bouchard said.

Opponents, he said, have painted the project as an assault to the neighborhood. But there will be no nighttime operations lit up with bright lights and no plans to have competitions with loudspeakers blaring riders’ names and results, Bouchard said.

“It’s a relatively low-impact recreational development that is closed six months of the year,” he said.

The park, he said, answers an unmet demand from Colorado’s avid cycling community. While a number of the state’s ski resorts — including Breckenridge, Keystone and the popular Trestle at Winter Park — offer lift-assisted downhill freeride mountain bike runs, Bouchard said they are sideshows to their primary ski operations.

“It’s just about the riding,” he said of Full Send Bike Ranch.

Full Send would be just over a half hour from the metro area via U.S. 285, and because it’s at a lower elevation than the state’s ski resorts, could be open for more days in the year — with a season extending from April to November.

“If you want to go mountain biking, you don’t have to wait until Saturday and put in a three-hour commute on Interstate 70,” Bouchard said. “You could go after work on a Wednesday.”

Plans also call for a lodge where riders can enjoy a beer after a run. Tickets would be priced at $50 to $80 a day, with season passes available, Bouchard said. The effort to build the park would be a multi-million dollar one, money Bouchard and his partner are confident they can raise if the project is approved by Jefferson County.

The friends are working on a lease arrangement with Colorado’s State Land Board, which owns the parcel.

Gary Moore, executive director of the Colorado Mountain Bike Association, said the Full Send Bike Ranch “scratches an itch” among the state’s earnest pedalers.

“They’re coming at this from a clean sheet design,” he said. “They could really just do what they want to do without facing restraints. There’s a huge contingent of mountain bikers on the Front Range that aren’t getting access to that style of riding.”

1638627057 690 A battle between pedaling and peace heats up over plans

Hyoung Chang, The Denver Post

Stop Bike Ranch sign near the corner of Shadow Mountain Drive and South Warhawk Road. in Conifer, Colorado on Friday, December 3, 2021. Full Send Bike Ranch will be a 250-acre lift access downhill mountain bike park at the area. (Photo by Hyoung Chang/The Denver Post)

“God’s country”

But neighbors point to Jefferson County’s own Conifer/285 Area Plan, updated in 2014, which notes that residents “value the community’s natural environment and rural neighborhoods.”

“Passive and active recreation facilities, including recreational buildings and outdoor multi-use fields, should be designed to respect and be compatible with the area’s natural resources, rural character and adjacent land uses,” the document states.

google news
Continue Reading

Trending