Research Methodology for Applied Economics

Research Methodology for
Applied Economics
Lecture 1
Introduction to the Course
• Syllabus (handout)
• Textbook
Ethridge, 2004, 2nd edition
Research Methodology in
Applied Economics
• Grading
1 – 2 Suggested exercises (end of chapter)
2 exams (Nov 6 & 13)
• Office hours
1 hour/day, 11:00am – 12:00noon, place TBA
Justification for the Study of Research
Need for formal, focused attention within the
economics discipline on how to organize and
conduct research in applied economics
Two central objectives:
1. Overview of the conceptual and
philosophical basis of research methodology
in economics
2. Procedural guidelines on planning, designing,
and conducting research projects
Reasons to Study Methodology
• Methodology is the manner in which we
approach and execute functions or activities
– Consists of approaches or guidelines, not specific
details of how we do the task (they are methods)
• Within a discipline, there are accepted rules of
evidence and reasoning
• Research methodology provides the principles for
organizing, planning, designing and conducting
research. (It does not tell you how to do specific
Reason for Studying Research
“ The central reason for studying research
methodology is that it provides a time-tested,
proven means of producing new, reliable
knowledge. That accumulated, growing body of
knowledge comprises a discipline, or perhaps a
‘science’” (p 4)
We need to differentiate research methodology
from research methods:
• Methodology – general approaches or guidelines
• Methods – specific details and/or procedures to
accomplish a task
One course can not teach all methods in
Agricultural Economics!
Examples of methods?
(regression analysis, optimization models, surveys,
econometrics ….. )
Research Methodology in Economics
• Study which integrates the various components
of economics to accomplish a defined, goaldirected research
• To expand our knowledge and make that
knowledge useful to the study of world problems
• To learn by doing under the supervision of an
advisor (shown to be an effective model)
• Pull together various aspects of economic
theories, methods, and analysis to present in a
coherent, logical, reliable and useful manner.
Recommendation from the Commission on
Graduate Education for Economics in the US
1. More emphasis on ‘real world’ problems and the
application of economic research to them;
2. More emphasis on communication skills, especially
writing, and the ability to relate economic
knowledge to the public.
Paradigm Shift for Success in Graduate
School is Needed
• Not determined solely by the understanding
of theories or techniques
• What is needed is the understanding of
economic issues, literature, research process
and ability to conduct research and
communicate results to the stakeholders.
Common flaws in Methodology
Failure to:
• Establish the reason for the research
• Provide clear & concise objectives
• Provide complete reference to prior research on
the subject and methods
• Lack of understanding for the conceptual and
theoretical basis of the research
• Selection of analytical structural model for mere
empirical convenience (or familiarity)
• Presenting conclusions that are merely
restatements of analytical findings (ie. results)
Objectives and Focus of the Course
Increase proficiency and effectiveness in
economic research efforts
Two primary objectives:
1. introduction to the conceptual and
philosophical foundations of research
methodology for applied economics research
2. procedural instruction on how to plan, design,
and conduct research projects
Creating good habits for graduate
• Doing research entails planning and designing
the research, implementing and completing
the analysis and disseminating the results.
• Conducting research that is defensible, useful
and expands our knowledge base is not an
Examples of ‘bad’ Methodology
Unclear about the research problem
Unclear about the objectives
Lack thorough awareness of previous work
Incomplete conceptualization of the problem
Confusing research means with ends
“Good research … is no accident.” (p 7)
What this course is not about
• Philosophy of science
• Economic methodology (the approach to
economic reasoning)
• Research methods (techniques)
Ethridge addresses 2 divergent but related
aspects of economic research methodology:
Processes of discovery and confirmation
– Discovery deals with formulating, finding, and
creating new knowledge, information
– Confirmation deals with validity or reliability of
– Discovery is a creative process (art) requiring
questioning, probing, pursuing alternative
avenues of exploration, etc..
– Confirmation is more highly developed and this is
the ‘science’ part of the discipline
Assumptions about the students
• You will conduct or be required to do research
• You have basic knowledge of economic theories
• You know basic statistics and social sciences analytical
• You are able to think abstractly
• You think critically (but not in extreme form – cynicism,
which is a barrier to understanding)
• You have the ability to synthesize from the facts and
information in front of you
• Ability to discern privately held beliefs from concepts
supported by evidence – ie. need for objectivity
• You are currently initiating a research project
Perspective and Views of the Author
(Don Ethridge)
(I like the way he lays out his beliefs and biases – this is rarely done)
• Ethridge appreciates economic theory, but likes to focus
on applied, problem solving issues.
“…the beauty of economics rests in its theory, but the
power of economics lies in its application to current
• His beliefs are a mixture of positivism, normativism, &
pragmatism, but mainly pragmatism.
• He sees economics as both an art and a science
Organization of the Course
• Definitional , conceptual and philosophical
aspects of Research Methodology (Chap 2 – 4)
– Define terms and concepts, examine the
methodology of process, how research
methodology is related to science, knowledge and
objectivity, prediction, etc..
• Procedural aspects (Chap 5 – 9)
– planning and organizing research
• Reporting of Research (Chap 10)
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