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Justin Fox

How Economics Went From Theory to Data

Number crunching on PCs made noodling on chalkboards passe.
A little humility goes a long way.

A little humility goes a long way.

Photographer: Toshifumi Kitamura/AFP/Getty Images

One of the most striking things about attending the annual meeting of the American Economic Association after a long absence is that economics is now really all about the data. Older theorists such as Eric Maskin (who won the 2007 economics Nobel), Jean Tirole (the 2014 Nobelist) and Bengt Holmstrom were still accorded prominent roles as luncheon speakers at this week's gathering in San Francisco, but in the sessions where actual research was being presented most of the activity and excitement surrounded empirical work.

Daniel S. Hamermesh of the University of Texas documented this shift in a 2013 article in the Journal of Economic Literature. In 1963, 1973 and 1983, the majority of the articles published in the American Economic Review, Journal of Political Economy and Quarterly Review of Economics, three of the field’s most influential journals, were works of theory -- with theory's dominance peaking in 1983. By 2011, theory's share was down to 27.9 percent.