Sunday, April 26, 2009

Emmanuel Saez Wins Clark Medal

Expert on Wealth Wins a Top Economics Honor, WSJ, April 25, 2009 .. Emmanuel Saez, a leading researcher on the causes of wealth and income inequality, has won the John Bates Clark medal, awarded to the nation's most promising economist under 40 by the American Economic Association.

Mr. Saez, a 36-year-old professor at the University of California, Berkeley, focuses on the very top of the wealth pyramid. He earned his Ph.D. from the Massachusetts Institute of Technology in 1999 and joined Berkeley's economics department in 2002.

Of the 30 other economists who have won the Clark medal, 12 have gone on to win the Nobel prize in economics, including last year's winner, Paul Krugman of Princeton University.

Other past winners include White House National Economic Council director Lawrence Summers and Steve Levitt, co-author of the best-seller "Freakonomics."

Since it was first awarded in 1947, the Clark has been given out every two years, but beginning next year it will be awarded annually.

Mr. Saez and Thomas Piketty of the Paris School of Economics examined income-tax figures from the U.S. and other countries to derive historic estimates of income inequality. Among their findings: Before the onset of the financial crisis, the top 1% of families by income accounted for nearly a quarter of U.S. income -- their largest share since the late 1920s.

Messrs. Saez and Piketty's work has stirred controversy. In a 2006 opinion piece in The Wall Street Journal, Alan Reynolds of the Cato Institute disputed their results on technical points, such as inconsistencies with official Census Department estimates.

The economists countered that Census estimates are based on survey data that can't capture the incomes of the very rich.

Mr. Saez, an easygoing Frenchman who loves surfing, has resisted overtures from the powerhouse economics departments at MIT and Harvard University. He has also made important contributions to tax theory, including how governments can optimally set tax policy and how households behave in response to taxes.

His recent papers are available at his webpage.

1 comment:

  1. "Mr. Saez. . . has also made important contributions to tax theory, including ... how households behave in response to taxes." It is that work, among others, that explains why we can't use reported income to measure "income inequality."
    When taxes on capital gains and other sources of high incomes go up, the amount that shows up in the top 1% of tax returns goes down." The work of
    Saez is somewhat schizophrenic in this respect. If behavioral response matters, then we can't talk about what how much income is reported at the top as if it was unrelated to marginal tax rates. That's all I ever said, and Saez has said it too (except when responding to me).