The Purpose of Economic Research: A Student's Perspective

The Methodologies of Economics
Department of Agricultural Economics and Business
University of Guelph
January 12, 2006
Student: Predrag Rajsic
Instructor: Glenn Fox

Essay assignment

The Purpose of Economic Research

Humans have always been intrigued by the purpose of their existence and their actions. Economic research is one of these actions. The term purpose is complex and can be answered on different levels. I start by differentiating between absolute and relative purpose. Next, I recognize that relative purpose can take at least two forms – individual (or personal) and collective. Creation of knowledge is at the root of both the collective and the individual purposes of economic research. These terms, and all other terms and definitions in this essay, are my attempt to articulate the problem of the purpose of economic research, and may or may not coincide with any definitions in the existing literature.

The term purpose embodies both the reason for existence and the goal of existence. In my view, there are two main categories of purpose – absolute purpose and relative purpose. If you believe in any kind of an absolute being, you may identify the absolute purpose as God’s plan for everything that exists. It is questionable whether humans can ever develop an understanding of this type of purpose. 

On the other hand, relative purpose is, to be consistent with the previous definition, man’s plan for everything that exists.  The term man from the previous sentence is a metaphor. It includes both men and women. It can represent an individual, a group, as well as the whole humanity. Conditionally, we could say that relative purpose can take two forms - personal and collective purpose. Within this framework, the personal purpose of an action is an individual’s perception of the reason for or goal of that action. The collective purpose of an action is the most widely accepted reason for or goal of that action by the members of society. I will now focus on the collective and the individual purpose of the human activity called economic research. This will show that these two types of purpose may or may not coincide. 

Throughout history there has been an immense amount of economic research. All the studies, projects, dissertations, analyses, papers, reports and many other forms of research were attempts to solve specific problems. Now, the question is what do we get from solving these problems? We get an understanding of the existing world and an ability to change it or to improve it according to a specific objective. Various groups, organizations, or institutions within society may have predetermined goals, but they lack the knowledge to achieve them. Therefore, these groups cooperate with researchers who discover the needed knowledge. This acquisition of knowledge corresponds to the collective purpose of economic research. 

How does new economic knowledge improve things? Let us first define improvement as a transition to a state of the world that is preferred over the current state. There are many different avenues through which new knowledge makes us humans happier. Homo sapiens seems to show a tendency to explore things just for the sake of knowing more about them. It appears that he or she derives specific pleasure from learning. Whether or not he or she cares about the well being that his or her discovery will bring to other people is harder to answer. Personal satisfaction from conducting research may be the only purpose one can see in research. If we take this personal satisfaction in the neoclassical sense, then we can say that utility maximization is the individual purpose of economic research. 

To conclude, the absolute purpose of the world and everything in it is not known to the human kind. Humans determine the relative purpose of things, and we can only talk about the relative purpose of economic research. The relative purpose of economic research can be collective or individual. Individual purpose relates to the researcher’s personal reasons for doing research. These may or may not include the desire to improve other people’s well being. Collective purpose is the reason why a group of individuals, and, in the broadest sense, humanity, supports economic research activities. There are as many reasons as there are specific objectives that these individuals or groups want to achieve. All possible collective and individual objectives have one common characteristic – improvement – achieving a more desirable (or preferred) state of the world (or state of one’s being) than the current state. A researcher prefers to have more economic knowledge than he or she currently has. The majority of the human kind may agree they prefer less poverty in the world than the current level. In the world of incomplete knowledge, economic research is needed to discover the necessary knowledge that will move the world (or an individual) to a more preferred state.


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