Month: October 2021

The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2021

This year’s Laureates – David Card, Joshua Angrist and Guido Imbens – have provided us with new insights about the labour market and shown what conclusions about cause and effect can be drawn from natural experiments. Their approach has spread to other fields and revolutionised empirical research.

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.

Using natural experiments, David Card has analysed the labour market effects of minimum wages, immigration and education. His studies from the early 1990s challenged conventional wisdom, leading to new analyses and additional insights. The results showed, among other things, that increasing the minimum wage does not necessarily lead to fewer jobs. We now know that the incomes of people who were born in a country can benefit from new immigration, while people who immigrated at an earlier time risk being negatively affected. We have also realised that resources in schools are far more important for students’ future labour market success than was previously thought.

Data from a natural experiment are difficult to interpret, however. For example, extending compulsory education by a year for one group of students (but not another) will not affect everyone in that group in the same way. Some students would have kept studying anyway and, for them, the value of education is often not representative of the entire group. So, is it even possible to draw any conclusions about the effect of an extra year in school? In the mid-1990s, Joshua Angrist and Guido Imbens solved this methodological problem, demonstrating how precise conclusions about cause and effect can be drawn from natural experiments.

“Card’s studies of core questions for society and Angrist and Imbens’ methodological contributions have shown that natural experiments are a rich source of knowledge. Their research has substantially improved our ability to answer key causal questions, which has been of great benefit to society,” says Peter Fredriksson, chair of the Economic Sciences Prize Committee.

Read the full article at: www.nobelprize.org

Perseverance rover reveals an ancient delta-lake system and flood deposits at Jezero crater, Mars

Observations from orbital spacecraft have shown that Jezero crater, Mars, contains a prominent fan-shaped body of sedimentary rock deposited at its western margin. The Perseverance rover landed in Jezero crater in February 2021. We analyze images taken by the rover in the three months after landing. The fan has outcrop faces that were invisible from orbit, which record the hydrological evolution of Jezero crater. We interpret the presence of inclined strata in these outcrops as evidence of deltas that advanced into a lake. In contrast, the uppermost fan strata are composed of boulder conglomerates, which imply deposition by episodic high-energy floods. This sedimentary succession indicates a transition, from a sustained hydrologic activity in a persistent lake environment, to highly energetic short-duration fluvial flows.

Read the full article at: www.science.org

W. Brian Arthur on Economics in Nouns and Verbs

What is the economy?  People used to tell stories about the exchange of goods and services in terms of flows and processes — but over the last few hundred years, economic theory veered toward measuring discrete amounts of objects.  Why?  The change has less to do with the objective nature of economies and more to do with what tools theorists had available.  And scientific instruments — be they material technologies or concepts — don’t just make new things visible, but also hide things in new blind spots.  For instance, algebra does very well with ratios and quantities…but fails to properly address what markets do: how innovation works, where value comes from, and how economic actors navigate (and change) a fundamentally uncertain shifting landscape.  With the advent of computers, new opportunities emerge to study that which cannot be contained in an equation. Using algorithms, scientists can formalize complex behaviors – and thinking economics in both nouns and verbs provides a more complete and useful stereoscopic view of what we are and do.

This week we speak with W. Brian Arthur of The Santa Fe Institute, Stanford University, and Xerox PARC about his recent essay, “Economics in Nouns and Verbs.” In this first part of a two-part conversation, we explore how a mathematics of static objects fails to describe economies in motion — and how a process-based approach can fill gaps in our understanding.

Listen (Part 1) at: complexity.simplecast.com

Also, listen to Part 2 on “Prim Dreams of Order vs. Messy Vitality” in Economics, Math, and Physics

The Nobel Prize in Chemistry 2021

Building molecules is a difficult art. Benjamin List and David MacMillan are awarded the Nobel Prize in Chemistry 2021 for their development of a precise new tool for molecular construction: organocatalysis. This has had a great impact on pharmaceutical research, and has made chemistry greener.

Many research areas and industries are dependent on chemists’ ability to construct molecules that can form elastic and durable materials, store energy in batteries or inhibit the progression of diseases. This work requires catalysts, which are substances that control and accelerate chemical reactions, without becoming part of the final product. For example, catalysts in cars transform toxic substances in exhaust fumes to harmless molecules. Our bodies also contain thousands of catalysts in the form of enzymes, which chisel out the molecules necessary for life.

Catalysts are thus fundamental tools for chemists, but researchers long believed that there were, in principle, just two types of catalysts available: metals and enzymes. Benjamin List and David MacMillan are awarded the Nobel Prize in Chemistry 2021 because in 2000 they, independent of each other, developed a third type of catalysis. It is called asymmetric organocatalysis and builds upon small organic molecules.

“This concept for catalysis is as simple as it is ingenious, and the fact is that many people have wondered why we didn’t think of it earlier,” says Johan Åqvist, who is chair of the Nobel Committee for Chemistry.

Organic catalysts have a stable framework of carbon atoms, to which more active chemical groups can attach. These often contain common elements such as oxygen, nitrogen, sulphur or phosphorus. This means that these catalysts are both environmentally friendly and cheap to produce.

The rapid expansion in the use of organic catalysts is primarily due to their ability to drive asymmetric catalysis. When molecules are being built, situations often occur where two different molecules can form, which – just like our hands – are each other’s mirror image. Chemists will often only want one of these, particularly when producing pharmaceuticals.

Organocatalysis has developed at an astounding speed since 2000. Benjamin List and David MacMillan remain leaders in the field, and have shown that organic catalysts can be used to drive multitudes of chemical reactions. Using these reactions, researchers can now more efficiently construct anything from new pharmaceuticals to molecules that can capture light in solar cells. In this way, organocatalysts are bringing the greatest benefit to humankind.

Read the full article at: www.nobelprize.org