An Examination of the Influence of Theory and Individual Theorists on Empirical Research in Microeconomics

Most economists would concur that an important role of economic theory is to influence the direction of empirical research, either by posing new questions or by suggesting new answers to old questions. Whether or not modern theory should be judged to be a success on that metric is a frequently debated question, but one on which there has been little systematic investigation. In this paper, we provide some preliminary empirical evidence on the extent to which various fields of economic theory, as well as specific theorists, have succeeded in influencing the path followed by empirical research in the area of microeconomics. Based on our analysis of all empirical microeconomics papers published in three leading journals over a three-year period, we arrive at a number of conclusions concerning the impact of theory on empirical research. Our first finding is that the set of theory papers cited as the primary motivation for leading empirical work is surprisingly dispersed. Very few individual works of theory seem to have exerted a great influence. In the 149 empirical papers we consider, one author (Gary Becker) is cited fifteen times, all other authors are cited ten times or less; no single paper is cited more than six times. A second finding is that empirical researchers behave as if they are heavily influenced by recent theoretical contributions. Among the theory papers identified as providing the central motivation for the empirical research, over half of all the citations are to theory papers published after 1990. The extent to which this pattern of citations is truly meaningful, however, is called into question by our third finding. Namely, the great majority of empirical papers test traditional economic ideas (i.e. concepts that were quite familiar to economists in the 1940s and 1950s), although often these old ideas are applied in non-traditional settings (e.g. crime, household economics). These papers do not show much direct influence of the theoretical fields that emerged since that time (e.g. general equilibrium, game theory, information economics, behavioral economics). Among the major innovations in theory in recent decades, only information economics has had a substantial influence on the empirical papers in our data set. Empirical papers testing game theory, general equilibrium, and behavioral economics are all quite rare in our sample. This pattern sharply contrasts with the distribution of theoretical contributions in the same journals in the same period, where the more 'recent' fields clearly dominate. Finally, we …