Alan B. Krueger, economist who reshaped US policymaking, is dead at 58

Alan Krueger, a prominent Princeton University economics professor who advised US Presidents Bill Clinton and Barack Obama, took his own life over the weekend, his family said in a statement on Monday. He was 58.
Dr Alan B. Krueger was part of a new wave of economists who pushed the field towards a more empirical mindset.
Dr Alan B. Krueger was part of a new wave of economists who pushed the field towards a more empirical mindset.PHOTO: REUTERS

NEW YORK (NYTIMES) - Dr Alan B. Krueger, who advised two presidents and helped lead economics towards a more scientific approach to research and policymaking, was found dead on Saturday (March 16) at his home in Princeton, New Jersey. He was 58.

The cause was suicide, according to a statement by his family released by Princeton University, where Dr Krueger taught for more than three decades. Princeton police said they were called to the home on Saturday morning and found Dr Krueger unresponsive.

Dr Krueger was an assistant secretary of the Treasury from 2009 to 2010, as President Barack Obama's administration tried to lead the United States out of its worst recession since the Great Depression. Mr Obama later named him chairman of the Council of Economic Advisers, a post he held from 2011 to 2013.

From 1994 to 1995, he was the Labour Department's chief economist under President Bill Clinton.

A labour economist by training, Dr Krueger was part of a new wave of economists who pushed the field towards a more empirical mindset, with an emphasis on data rather than theory. He applied that approach broadly: to education, health care, labor markets and terrorism, and even to more lighthearted subjects like the rising price of concert tickets. His latest book, due out in June, is on the economics of the music industry.

"He is certainly among the most - if not the most - significant labour economists and all-around empirical economists of the last three decades," said Dr Lawrence Katz, a Harvard economist and frequent collaborator. Dr Krueger, he said, was one of a handful of researchers who "really changed the shape of economics and turned it into a more serious science".

Dr Krueger was perhaps best known for his work with Dr Katz and another economist, Dr David Card, in the early 1990s on the effects of the minimum wage. Standard economic thinking at the time held that raising the minimum wage would reduce employment for low-wage workers; Dr Katz said that he and Dr Krueger had expected to find the same. Instead, they found no effect on employment - a finding that remains in dispute but that has proved influential.

"Even when people were saying you're crazy as an economist, he was really willing to let the data lead where it went," Dr Katz said.

Dr Krueger was a young, newly tenured professor in 1994 when he was tapped by the secretary of labour, Dr Robert B. Reich, to serve as chief economist for the department, succeeding Dr Katz. After two years in the job, Dr Krueger returned to Princeton and vowed never to return to government, according to a 2014 profile in a Princeton alumni magazine.

But in late 2008, Dr Krueger got a call from Mr Timothy F. Geithner, Mr Obama's pick for Treasury secretary. As Dr Krueger recalled it in the magazine profile, Mr Geithner said: "The economy's in a free fall. Why don't you come to Treasury and work on big, consequential things?"

"That was his line," Dr Krueger said. "And I couldn't say no."

Dr Krueger spent two years at Treasury as chief economist and assistant secretary for economic policy. Then, after a brief return to Princeton, he went back to Washington as chairman of the Council of Economic Advisers, where he pushed the administration to focus on issues of inequality and economic opportunity.

While at the White House, he developed and popularised the "Great Gatsby curve", the notion that countries with greater inequality had lower economic mobility from generation to generation.

In a statement on Monday (March 18), Mr Obama praised Dr Krueger as "someone who was deeper than numbers on a screen or charts on a page".

"He had a perpetual smile and a gentle spirit - even when he was correcting you," Mr Obama said.

Dr Krueger was born Sept 17, 1960, and grew up in Livingston, New Jersey, less than 80cm from the university where he would make his professional home. His father, Norman, was an accountant; his mother, Rhoda, taught first grade.

Dr Krueger attended Cornell University intending to become a lawyer. But while analysing data for an undergraduate research paper, he found that he enjoyed empirical work. After graduating from Cornell in 1985, he pursued a degree in economics at Harvard University, where he earned a Ph.D. in 1987.

Dr Krueger arrived at Princeton in 1987 as an empirical revolution was dawning in the economics profession. He quickly made his own contribution, helping to found a survey research centre there at a time when relatively few economists were conducting their own surveys. He pioneered the use of so-called natural experiments to study the effects of government policies.

"It was the ability to be both interesting and credible - that was his great gift," said Dr Lawrence H. Summers, who taught Dr Krueger at Harvard and later worked with him in the Obama administration.

"That's part of why there've been generations of people doing natural experiments."

Dr Krueger's more recent work focused on the structural reasons particular groups have struggled in the modern economy. He studied the effects of long-term unemployment in the wake of the recession, and how the opioid epidemic has pushed some workers, particularly men, out of the labour force.

He also helped bring attention to companies' use of noncompete agreements with employees as a means of holding down wages, and to occupational licensing rules as an obstacle to workers seeking better-paying careers. He proposed new rules to protect workers in the so-called gig economy, and just last week delivered a lecture at Stanford University on proposals for a universal basic income.

"Economics is a social science, and Alan was someone who was really interested in the social part of it as well as the science part of it," said Dr Betsey Stevenson, a University of Michigan economist. "He wanted to understand how people were doing, how people were feeling."

Dr Jason Furman, a Harvard economist who worked with Dr Krueger on the Obama economic team and succeeded him as chairman of the Council of Economic Advisers, said Dr Krueger had been the rare economist who was outstanding at both research and public policy. He sometimes combined the two, to persuasive effect.

In the midst of the Great Recession, Mr Obama was weighing whether to propose a tax credit for companies that hired new workers, though he was skeptical of the idea, Dr Furman said, because several businesses had told him that it would not sway their hiring decisions.

Dr Krueger, instead of doing a survey of research on such tax credits, used Princeton's survey group to poll small businesses on questions relating to job creation. He then used the results to argue that the credit would subsidise job creation in a cost-effective way - even if many businesses ignored it.

"I don't think Alan knew the answer before he did the survey," Dr Furman said. "He found out the answer from the survey. He didn't content himself with what was out there in the literature already."

Dr Krueger served in Democratic administrations, and his research tended to support liberal causes. But Dr Stevenson noted that his work on occupational licensing had been influential among conservatives as well. And he was willing to reach conclusions that did not align with his policy preferences; in one such instance, his research found that poverty did not cause terrorism.

His survivors include his wife Lisa Simon Krueger, and his children, Ben and Sydney. A complete list of survivors was not immediately available.

Dr Krueger was a contributor to the Economic Scene column and the Economix blog in The New York Times.

Colleagues at Princeton recalled Dr Krueger as having a nearly boundless curiosity. Dr Card, a frequent collaborator early in their careers, said Dr Krueger used to pore through code books of survey questions looking for potential research questions.

"He had headlights that went a lot further in the dark than anybody else," Dr Card said.