Seminar in Economics Econ. 470 Chapter 4: Research Process Stage One - Stage Two

Stage 1: The Broad Problem Area  Examples of broad problem areas that researchers (economists) could observe : 1- Government expenditures on health are improving medical equality. 2- The government subsidies of a product are not helping to reduce the inflation. 3- The introduction of flexible work hours has created more problems than it has solved in many government units. 4- Reduction in oil prices creates budget deficit in Kuwait. 5- Reducing tariffs among GCC states are not enhancing bilateral trade among them. 2 © 2009 John Wiley & Sons Ltd.

 Recall the Research process: 1)Broad problem area 2)Problem statement 3)Theoretical Framework 4)Generation of hypotheses 5)Data collection: 6)Data analysis: if Yes go to 7 ( if No go to back!!!) 7)Report Writing( Interpretation of results) 3 © 2009 John Wiley & Sons Ltd.

Why this Problem  Job Research  Interests  Hot Topic  Others 4 © 2009 John Wiley & Sons Ltd.

Skim Over Literature Review  A good literature survey: –Ensures that important variables are not left out of the study. –Helps the development of the theoretical framework and hypotheses for testing. –Ensures that the problem statement is precise and clear. –Enhances testability and replicability of the findings. –Reduces the risk of “reinventing the wheel”. –Confirms that the problem is perceived as relevant and significant. 5 © 2009 John Wiley & Sons Ltd.

 Conducting the Literature: –Based on the specific issues of concerns (raised in the literature) and factors (variables( identified, the literature review needs to be done on these variables. –Make sure that the identified published/unpublished papers are available (or can have access to them) on the topic of interest. –Gathering the relevant ones. –Be ready to write the literature section after finishing this step. 6 © 2009 John Wiley & Sons Ltd.

Stage 1: The Broad Problem Area  What are YOU curious about?  What interests YOU?  Why did YOU decide to advance your study of economics?  Inevitably start with a broad topic  An example: “The interaction of political systems and economic prosperity” 7 © 2009 John Wiley & Sons Ltd.

“The interaction of political systems and economic prosperity: your thoughts?”  Why? - The Arab Spring - The collapse of the Soviet Union - Intervention in Iraq, Afghanistan  Not yet a research question? - It is not specific enough. - What is meant by economic prosperity? - How can political systems be characterised? Stage 1: The Broad Problem Area

Stage 2: The Problem Statement  After reading into the literature, the researcher now can narrow down the problem from the original broad.  The question( problem) does not necessarily mean that something is seriously wrong.  The problem (question) could indicate an interest in an issue, where finding the right answers might help to improve an existing situation.  Thus, the problem statement is a clear, precise, and brief statement of the question to be investigated with the goal of findings an answer or solution. 9 © 2009 John Wiley & Sons Ltd.

 Narrow down the broad topic towards a research question: don’t go for a Nobel prize!!  Economic prosperity GDP, per capita GDP, Growth in GDP, per capita GDP  Characterisation of political system Frequency of elections, Frequency of change of government, Number of political parties, Independence of the judiciary, Democracy

Stage 2: The Problem Statement  Your expected research question must be conditional and has contributions : – time, –sample, –methodology. 11 © 2009 John Wiley & Sons Ltd.

 The interaction of political systems and economic prosperity  Political systems – too vaguedemocracy  Economic prosperityper capita GDP growth Interaction – relationship, correlation, causality? Note:  With your real topic, refer to the literature to help. It is a good idea to follow established practice. There are usually reasons for it.  Modified topic: The relationship between democracy and (per capita) economic growth– can you make your topic more precise?? Developing the Topic: Making the Topic More Precise

Issues Raised By Topic Development Current topic area: “the relationship between democracy and (per capita) economic growth” i) To what extent will the study be empirical (supported by reference to theory)? (Expected to have empirical content.) Can it be empirical? ii) How can the relationship of interest be explored? a) Take a snap shot of a set of countries. Take a sample of countries both democratic and non-democratic and compare growth rates? Static. Cross-sectional. b) Look at the development of one or two countries over time? Take a country that has changed between democracy and non- democracy and examine its growth over time. Dynamic. Time series. c) Look at a group of countries together over time? Dynamic. Panel data.

iv)Sample issues: which countries, when and why? v) What are the key variables? Can they be measured? Measurement of democracy? vi) Other factors: Other things cause growth- What other things?- Identify conditioning factors.  Keep an open mind, but have a clear starting point.  You will certainly have to modify your proposal more than once.  You may have to narrow it further.  You may have to use different variables from the ideal.

The Research Proposal  Key elements: –Purpose of the study –Specific problem to be investigated –Scope of the study –Relevance of the study –Research design: Sampling design Data collection methods Data analysis –Selected Bibliography 15 © 2009 John Wiley & Sons Ltd.