Working Paper: NBER ID: w22253
Authors: Jeff E. Biddle; Daniel S. Hamermesh
Abstract: We identify three separate stages in the post-World War II history of applied microeconomic research: A generally non-mathematical period; a period of consensus (from the 1960s through the early 1990s) characterized by the use of mathematical models, optimization and equilibrium to generate and test hypotheses about economic behavior; and (from the late 1990s) a partial abandonment of economic theory in applied work in the “experimentalist paradigm.” We document the changes implied by the changing paradigms in the profession by coding the content of all applied micro articles published in the “Top 5 journals” in 1951-55, 1974-75 and 2007-08. We also show that, despite the partial abandonment of theory by applied microeconomists, the labor market for economists still pays a wage premium to theorists.
Keywords: empirical microeconomics; economic theory; credibility revolution; experimentalist paradigm
JEL Codes: B21; B23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Established theoretical approaches (B52) | Influence on empirical research in the 1950s (C90) |
| Established theoretical approaches (B52) | Influence on empirical research in the 1970s (C90) |
| Structural approach (B52) | Shaping of empirical research landscape in the 1970s (C90) |
| Rise of the experimentalist paradigm (C90) | Decline in prevalence of theoretical models in empirical research by the 2000s (C59) |
| Evolving research practices (C90) | Perceived utility of theory in empirical economics (D11) |