Our researchers focus on theoretical and empirical analysis of economic decisions and phenomena. Welcome to the world of economics.
The theoretical analyses aim to identify, conceptualize, characterize economic problems in order to provide solutions to them. Examples of problems are poverty, public spending, unemployment, school choice and house allocation.
The empirical studies analyse existing data about economic decisions and phenomena to determine statistical relationships and causal links between important economic variables like income, education and unemployment, but also between economic variables and other factors like risk-taking and genetical factors. Empirical studies connect to the theoretical analyses by testing theories and by making observations that demand theoretical explanations.
An important strength of our Economics research is that it covers several fields and uses different methods at the same time as each field has produced research of high international standard. As a result of this faculty members have recently been able to publish in internationally top-ranked research journals, not in one field, but in several.
The most prominent research fields at the department include econometrics, financial economics, international economics, and applied and theoretical microeconomics.
Tackling questions facing society
One important contribution to society is indirectly through education. Each year, about 2.000 students are registered to courses at the Department of Economics. Through our research-based education, new findings and methods will spill over to the students and impact their understanding of society and the economy. We take pride in working together with colleagues from different departments and faculties on several programmes.
Economics is one of the oldest subjects within Lund University. We trace our roots back to Samuel Pufendorf (1632–1694), professor in Law, as well as an economist. He laid the groundwork for economics at Lund University back in the 1600s.
Our most influential economist historically, was most likely professor Knut Wicksell (1851–1926). Many would claim that his most important contribution was his theory of interest. For instance, the concept of natural rate of interest was invented by Wicksell. This is the interest rate which is compatible with stable prices. This concept facilitates the understanding of inflationary and deflationary processes.
Another significant idea is the concept of global games. This concept was developed in the 1990s by professor emeritus Hans Carlsson in collaboration with a researcher from the Netherlands and has been applied to better understand bank runs, currency crises and bubbles.
Today the most influential research in Economics at the School consists of empirical studies in many different areas. These studies often use and combine high quality data from Scandinavian registers.
An ongoing project that has direct practical life-and-death consequences for people, and also involves collaboration between economists and medical experts, is the design of a kidney exchange program in Scandinavia. In this project our matching theory experts apply their methods and knowledge to kidney exchange problems.
Another example is the research effort trying to understand the origins of risk-taking on financial markets. The acceptance of risks has important financial consequences for people. However, little is known about the extent to which these relationships are genetic or determined by environmental factors. To be able to separate between genetic and environmental factors, data on stock market participation of Swedish adoptees are used and related to the investment behaviour of both their biological and adoptive parents. The researchers conclude that – when appropriate controls are used – environmental factors appear to dominate.