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The path of economics research production: Insights into the seesaw between theory and empirics
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Innovation and Structural Change
USA
Europe
This paper provides insights into the apparent seesaw between the generation of theoretical versus empirical economics research over time. A dynamic model considers the incentives of researchers to focus on empirical versus theoretical papers. It yields the main characteristics of the path-changing of economics research, from theoretical-intensive to empirical-focused. The model has two equilibria, one with a higher proportion of theoretical papers and another with a higher proportion of empirical papers. Curiously, the equilibrium with greater theoretical papers is stable, while the one with more empirical papers is a saddle point. This suggests that the current trend of increasing empirical research is unlikely to last.
