Fundamentals of Research Methodology in Economics

Types of Research

(i) Descriptive vs. Analytical

• Descriptive Research:

  • Includes surveys and fact-finding inquiries; aims to describe current state of affairs.

  • Often referred to as Ex post facto research, as it does not involve control over variables.

  • Characteristics include reporting what has already happened.

  • Example: A government survey measures average household healthcare expenditures in low-income groups.

• Analytical Research:

  • Goes beyond mere description by interpreting and evaluating data to discover relationships or test hypotheses.

  • Example: An economist analyzes ten years of trade data to assess the impact of trade liberalization on domestic industries.

(ii) Applied vs. Fundamental

• Applied Research:

  • Aims to find immediate solutions to problems faced by society or organizations.

  • Example: Assessing microfinance programs' impact on poverty reduction or evaluating tax reforms on small businesses.

    Characteristics:

    • Goal is practical application.

    • Tries to improve technology, create new products, or solve specific challenges.

    • Findings are directly usable by businesses, industries, or governments.

    • Less concerned with theory, more concerned with action.

• Fundamental (Basic) Research:

  • Focuses on generalizations and theoretical formulations.

  • Involves gathering knowledge for the sake of knowledge.

  • Example: Developing a theoretical model of consumer behavior under uncertainty.

    Characteristics:

    • Goal is knowledge for the sake of knowledge.

    • Explores concepts and theories.

    • No immediate focus on real-world problems.

    • Lays the foundation for future applied research.

      Aspect	Applied Research	Fundamental Research

      Purpose

      Solve specific, practical problems

      Expand general knowledge

      Focus

      Immediate application

      Theoretical understanding

      End-Use

      Directly useful in real life

      May not have immediate use

      Example

      Develop a new drug

      Study DNA structure

      Who Performs

      Companies, Governments

      Universities, Academicians

(iii) Quantitative vs. Qualitative

• Quantitative Research:

  • Based on measurements that can be expressed quantitatively; utilizes tools like surveys, questionnaires, and experiments.

  • Involves large sample sizes and statistical analysis (mean, median, correlation, regression).

    Characteristics:

    • Data is in the form of numbers (e.g., percentages, scores, ratings).

    • Uses structured tools: surveys, questionnaires, experiments.

    • Focuses on quantity ("how much?", "how many?", "how often?").

    • Analysis is statistical (averages, correlations, regression).This approach emphasizes measurable data and relies on numerical analyses to establish patterns and relationships in economic phenomena. Furthermore, it often involves hypothesis testing to determine the significance of findings and to make predictions about economic behavior.

      Common Methods:

      • Surveys with closed-ended questions (like MCQs).

      • Experiments (scientific tests in controlled settings).

      • Observational research (counting specific behaviors).

      • Longitudinal studies (studies over time with numerical tracking).

• Qualitative Research:

  • Investigates quality or kind, focusing on why people behave as they do.

  • Often involves Motivation Research to uncover underlying motives; uses in-depth interviews.

  • Examples: Interviews about patients' experiences or focus groups discussing consumer attitudes toward products.

    Characteristics:

    • Data is non-numerical (texts, audio, video, interview transcripts).

    • Focuses on quality ("why?", "how?", "in what ways?").

    • More open-ended and flexible.

    • Looks for patterns, themes, and deep meanings.

    ➔ Common Methods:

    • In-depth interviews.

    • Focus group discussions.

    • Observations (without counting, just describing behaviors).

    • Case studies (detailed study of one or few subjects).

      Feature	Quantitative Research	Qualitative Research
      Data Type	Numbers (numerical)	Words, descriptions, concepts
      Focus	Quantity ("how much/many")	Quality ("why/how")
      Objective	Measure and predict	Understand deeper meanings
      Data Collection Tools	Surveys, experiments	Interviews, observations
      Analysis	Statistical analysis	Thematic/textual analysis
      Sample Size	Large (100s or 1000s)	Small (10-50 often)
      Outcome	Hard facts and generalizations	Deep insights and understanding
      Example	% of customers satisfied	Why customers feel satisfied

(iv) Conceptual vs. Empirical

• Conceptual Research:

  • Relates to abstract ideas or theories; often used by philosophers.

  • Relies heavily on existing literature to generate new ideas or reinterpret existing theories.

  • Conceptual research is about developing new ideas, concepts, or theories — or rethinking existing ones.
    It focuses on thinking, reasoning, and logical analysis without direct experiments or observations.

  • Example: Developing a new model to explain consumer behavior by integrating insights from various disciplines.

    Characteristics:

    • Based on existing knowledge and mental exploration.

    • Focuses on building new models, frameworks, or philosophies.

    • No experiments, surveys, or data collection from the outside world.

    • Heavy use of logical arguments, thought experiments, hypothetical scenarios.

    ➔ Common Methods:

    • Logical reasoning.

    • Critical analysis of existing theories.

    • Hypothetical modeling.

    • Philosophical discussions.

• Empirical Research:

  • Based on observation or experience, often leading to conclusions verifiable by data.

  • Data-based and experimental; starts with a hypothesis and collects data to confirm or refute it.

  • Examples: Measuring the effects of minimum wage increases on employment levels or studying consumer behavior changes due to tax rebates.

    Characteristics:

    • Based on facts, evidence, and data.

    • Involves experiments, surveys, observations, or interviews.

    • Tests hypotheses or research questions.

    • Results are verifiable and reproducible.

    ➔ Common Methods:

    • Surveys and questionnaires.

    • Laboratory experiments.

    • Observational studies.

    • Case studies.

    • Fieldwork.

      Feature	Conceptual Research	Empirical Research

      Basis

      Ideas, concepts, theories

      Observations, experiments, real data

      Method

      Logical reasoning, thought analysis

      Surveys, experiments, field studies

      Data Involvement

      No data collection

      Direct data collection

      Purpose

      Build theories, new concepts

      Test theories, find evidence

      Example

      Developing a new economic theory

      Surveying 1000 people about job market

      Nature

      Abstract

      Practical and evidence-based

(v) Other Types of Research

• One-time vs. Longitudinal Research:

  • One-time research is confined to a single time frame, while longitudinal research spans several time periods.

  • Example: Longitudinal Ageing Study in India (LASI).

• Field vs. Laboratory Research:

  • Research can occur in field settings (real-world environments) or controlled laboratory settings.

• Historical Research:

  • Utilizes historical documents and remains to study past events, ideas, and philosophies of individuals or groups.