We spend a lot of time in Economics courses looking at problem solving. Given a problem in a specific form, can you figure out the (usually) well-defined answer?
But in economics research, and in the work that most students will do after graduation, we don’t normally spend much time trying to solve well-defined problems. The trick, almost always, is to figure out how to define a problem and simplify it to something you can solve, while being aware of the limitations of that solution. This is the heart of critical thinking.
To be successful in economics, you need to be able to do both. Some bad economics is done by people with pretty good critical thinking skills – able to look at a problem and simplify it down to something that they can solve. The challenge is when the problems are simplified too far and we lose the essence of the original issue. At that point, it isn’t clear what we are solving anymore.
More commonly, bad economics is high level problem solving without critical thinking. When this happens, we lose awareness of the limitations of our knowledge. If you spend days, weeks or years trying to solve a problem, it becomes far too easy to overstate the value of your solution by simply ignoring that your answer is only as valuable as the assumptions that you made. And I guarantee that you made some critical assumptions.
(Maybe) especially at the undergraduate level, the best papers are those that fully recognize their limitations – limitations of data, or key theoretical assumptions, or an alternate methodology that might be more appropriate next time.
In Sports Economics, we can simplify problems – should a football offense run or pass, and how should the defense respond? But the reality is that the underlying situation is normally far more complicated. The key step is to simplify problems so that we learn something – such as why mixed strategies make sense – and then use that knowledge to say something about the more complicated issue.
My intention is to discuss this far more in EC310F this term – and to encourage students to explicitly recognize which simplifications matter most in their papers.