CUNEF Universidad hosts a seminar by David Card, Nobel Prize in Economic Sciences 2021

David Card, Professor of Economics at UC Berkeley and Nobel Prize in Economic Sciences in 2021, visited CUNEF Universidad today to give a seminar on “Intergenerational mobility in earnings: The roles of neighbourhoods and firms”. This study examines the causes and dynamics of the wage gap between the Caucasian and African American population in the United States and shows that the neighbourhoods where children grow up and their parents’ socioeconomic background have a strong influence on their future salary.

During the seminar, held in the Auditorium of the Almansa Campus, David Card stressed that parents’ income explains approximately 50% of the salary differences between children born in Caucasian and African American families. Similarly, the neighbourhoods where families live account for an additional 15%. His research also shows that a neighbourhood’s average income can have a positive impact on children’s future wages. This would mean that both the quality of their neighbourhood—measured in socioeconomic terms—and its demographic makeup would have a significant impact on the job and wage opportunities of young Americans.

The study also reveals that African American families in the United States tend to live in neighbourhoods with lower average income levels and, at the same time, with a higher presence of African-Americans, which in turn has compensatory effects. “Neighbourhood quality is related to parents’ income and racial origin. One of the reasons why African American children have lower incomes over their lifetime is because they grew up in slightly less privileged neighbourhoods,” Card said. In cities with higher levels of segregation and discrimination, neighbourhood and income gaps intensify, reflecting persistent structural barriers.

The study also breaks down parental and neighbourhood effects, showing how personal and business factors pass on advantages or disadvantages from one generation to the next, beyond the mere accumulation of human capital. In addition, the child’s gender also has an impact, but he has not yet done extensive research on that, which makes it “a good topic for future research”.

Recognised as one of the world’s most influential economists, the Royal Swedish Academy of Sciences awarded the Nobel Prize to David Card for his “empirical contributions to labour economics.” The seminar held today was attended by CUNEF Universidad professors and students, as well as researchers and economists from other institutions. Activities such as this showcase CUNEF Universidad’s commitment to excellence in teaching and research, and to transferring knowledge and critical thinking to its university community and society in general.