Tuesday, April 16, 2024 | 12:35 WIB

Honoring Professor Claudia Golden, 2023 Nobel Laureate in Economics

Jakarta, IO – I would like in this column to pay my respects and honor to Professor Claudia Goldin, 2023 Nobel Laureate in Economics. I would also like to apologize for writing in a previous column in this paper regarding all the Nobel Laureates of 2023: regarding the Nobel Peace Prize in Chemistry, Physics, and Economics, I made the mistake of mentioning Bernanke, Diamond and Dybvig together are the winners of the Nobel Economics Prize. Then, a couple of paragraphs later, I added the name of Professor Claudia Goldin. I do not know why, but that was mistaken. The correct attribution is that Professors Ben Bernanke, Diamond, and Dybvig are winners of 2022 Nobel Economics Prize, and Professor Goldin the 2023 Nobel Laureate in Economics. My humble apology for this mistake, and with this the matter is corrected. 

Professor Claudia Goldin is a Harvard Professor of Labor Economics, holding the Henry Lee Chair, while serving as Co-director of the National Bureau of Economic Research (NBER)’s Gender Economy and former Director of NBER. She acquired her doctorate from the University of Chicago, which is known to value academic freedom and freedom of opinion very highly, with Professor Milton Friedman as her mentor. 

J. Soedradjad Djiwandono
J. Soedradjad Djiwandono. Emeritus Professor of Economics, FEBUI, Jakarta, and Adjunct Professor of International Economics, S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University (NTU), Singapore.

She is only the third woman to receive the accolade of Economics Nobel Laureate and the first woman professor to get tenure at Harvard University. The first Nobel prize-winner was Elinor Ostrom in 2009, and the second Esther Duflo in 2019. With her seminal research on women’s participation in the labor market, applying her labor economics skill and historian technique of plotting women’s roles in the labor market, her findings become very important. Interestingly, over the history of 200 years, women’s participation in employment is not parallel with development, but rather a U-shaped one. 

The transformation from agriculture to manufacturing and later services, and the societal norm of women’s participation in employment, in combination with taking care of children as well as the changes in the types of work, all contributed to the shape of the curve that became U-shape. Professor Goldin argued that the change in working standards over time does not change the nature of women’s participation in the labor market, but the availability of contraceptives does, as it gives women the choice to invest in themselves through education for better choices in the future. 

The norm for equal pay, which is still a problem everywhere should be facilitated by the findings of Professor Goldin’s study, and those wishing to make progress in this issue should take a look at Professor Goldin’s study and try to get what to learn to improve women’s stake in the fight for equal pay. This is 2023; this issue should not be with any society any longer. I am no labor economist nor an expert on gender issues, yet reading the news on these I think it is important that those interested in the issues should at least read the study of Professor Goldin’s study which seems to shed some light on the issues. 

Some notes 

What was studied by Professor Claudia Goldin who won her Nobel Prize was data on women’s participation in the labor market in the US economy, over the last 200 years. The question is whether similar data for other countries, Indonesia for example, might also yield similar results, as explained by the author. It may be safe to say that most probably the readings would be different, due to different circumstances, cultures, stages of development, and others. But this is definitely just speculative, since I do not have any basis for saying it. 

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On the other hand, if we remember the study by Thomas Piketty about income distribution, to our surprise his findings could contradict our belief for years of what the conclusion of a study years and years before, by a very prominent Professor Simon Kuznets of Harvard University, 1971 Nobel Laureate in Economics, who said that income distribution over time takes a bell-shaped curve, which means that income inequality rises at the start of the development process, reaching a peak, and then going downward afterward. This theory has become part of development literature that students like myself learned for years. But, Thomas Piketty in 2015 published a book that reports his study to debunk Professor Kuznets’s established theory. 

With the help of high-powered computers and the availability of tax returns from many countries, he demonstrates that income inequality does not go down with economic growth and development. So, gone is the notion that income inequality in less developed countries must be worse than in developed ones. I do not know if my comparison of this case with the case of women’s participation in the workforce makes sense, but I am just curious. My apology if I just add issues to your heavy burden here.

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