Main subject areas in economics

From applied microeconomics to public economics – read more about our research and our main subject areas.

Applied microeconomics

Applied microeconomics is an umbrella term used for mainly empirical studies in labour, urban, education, public, health, and environmental economics. The department’s applied microeconomists have many different research interests which they take out into the field in order to examine questions of individual behaviour and societal outcomes often by applying advanced microeconometric methods.

In one recent study, led by professor Petter Lundborg, the labour market response to having children among women who have no children (but are motivated to have) are examined. To identify fertility effects measured at the extensive margin (that is to have the first child), a new instrumental variable strategy based on in vitro fertilization (IVF) is used. Treatment success at the first IVF treatment is regarded as a natural experiment and the working careers of women after a successful first treatment (treatment group) are compared to those of women after a failed first treatment (comparison group). This design allows the researchers to isolate the causal mechanism of having children on women’s labour market outcomes.

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In another area of study, Associate Professor Kaveh Majlesi investigates how economic agents respond to labor market shocks.

”In a recent paper, my coauthors and I investigate how rising import competition from China contributed to the polarization of U.S. politics. Exploiting the exogenous component of rising trade with China and classifying legislator ideologies by congressional voting records, we find strong evidence that congressional districts exposed to larger increases in import penetration disproportionately removed moderate representatives from office in the 2000s. Trade-exposed districts with an initial majority white population or initially in Republican hands became substantially more likely to elect a conservative Republican, while trade-exposed districts with an initial majority-minority population or initially in Democratic hands also become more likely to elect a liberal Democrat,” Kaveh Majlesi explains.

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Contact: Professor Petter Lundborg


The research group in econometrics consists of time series and panel data econometricians, who overlap to a large extent with microeconomists, macroeconomists and financial economists at the department. Most research conducted within the group is theoretical with empirical applications, mainly in macroeconomics and finance, but also in microeconomics. Other researchers within the department are applied econometricians doing empirical work with a substantial econometric component. Their research will be found within their own specializations.

The current research agenda of the members of the group is wide and include: 

  • testing and estimating models of cointegrated time series and panel data
  • testing for unit root and explosive, bubble-style, time series behaviour
  • estimation of cross-sectionally dependent panel data models
  • forecasting and prediction
  • estimating treatment effects
  • wavelet analysis of irregular time series.

The type of panel data considered is equally wide and span the entire spectrum, from the type of ”long panels” usually encountered in macroeconomics and finance, to micro-type ”short panels”. Together with the work on pure time series, this makes for a very complete portfolio when it comes to the type of data that the group is engaged in.

The members of the group are keen on sharing their work with empirical researchers, and supply user-friendly computer programmes that implement the methods that they develop.

Contact: Professor Joakim Westerlund

Researchers in econometrics

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Financial economics

Our research covers several major areas related to financial economics, such as behavioural and household finance, asset pricing, analysing financial risks, and the interaction between the financial sector and the real economy.

Within behavioural and household finance, we look at the factors affecting individuals’ attitudes towards risk. More specifically, we investigate the relative importance of genetic and environmental factors on risk taking behaviours. One example of this is when we study to what extent the decision of adoptees to hold equities is associated with the behaviour of their biological and adoptive parents. We also analyse how households’ level of education affects their incentives for risk taking. Two other research papers in the field of household finance investigate how households’ consumption responds to changes in stock market returns and how the realization of a financial shock, in the form of inheritance, affects saving behaviours.

We currently have two main projects in asset pricing and analysis of financial risks.

One of the projects is related to network theory and aims to provide evidence for asset-pricing relationships among firms using information about firms’ economic networks. The research covers a variety of different networks, for example bank-firm, supplier-customer, and competition within the same industry. By employing a spatial econometric approach, we can accurately capture the feedback effects and the propagation of a shock through the whole input-output network. Related to this project we are developing a multivariate spatial model which allows an intra-location feedback effect of different economic variables.

The second project employs a mixed data sampling approach to decompose financial risk into a long-term and a short-term component. It aims to investigate how the two components of risk are related to different types of economic information and to improve the abilities of the existing asset-pricing models in explaining the cross-sectional differences in expected equity returns.

Another part of our research aims to explore the interaction between the financial sector and the real economy. We investigate the effect of financial factors on the interactions between firms (buyers and suppliers). This complements the existing finance-growth literature that mostly emphasizes interactions or information asymmetries between the agents from the real economy on the one side and providers of external finance on the other. We also investigate the effects of finance on international trade flows, in particular long-term export survival.

Another project in this area studies the role of banks’ behaviour and supply-side effects on outcomes in the credit markets. We apply a number of novel approaches to the study of banks’ loan supply, with an emphasis on their loan pricing, loan portfolio allocations, collateral use, and risk-taking decisions, and how these factors interact with macroeconomic fluctuations, market structure (competition), and regulation.

Contact: Professor Hossein Asgharian

Researchers in financial economics


Microeconomics studies the behaviour of economic agents, such as households and firms, and their interaction with various forms of economic institutions. The microeconomics research group consists of active researchers, many working on a wide range of topics.

One subgroup specializes in market/mechanism design and social choice theory. The research focuses primarily on the design of strategy-proof mechanisms, auction design, voting rules, and provision of public goods.

Another active group of researchers uses empirical and experimental methods to understand individual decision making and behaviour in games. The topics of research include cooperation and communication in games and decision making under risk and uncertainty.

Other research areas include cooperative and non-cooperative game theory.

Contact: Professor Tommy Andersson

Researchers in microeconomics

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International economics and development economics

Our faculty’s research covers most areas in the field of international economics, but with a special emphasis on applied work within international trade. Current research focus on firms’ decisions concerning trade and foreign direct investments, how globalization affects regions, firms and workers within a country, and how to explain trade dynamics at an aggregate country level. Our researchers also work on the importance of transportation costs and various forms of non-traditional trade barriers in shaping production patterns and international trade.

When it comes to development economics, our researchers do a lot of work on the determinants and consequences of investment in education and health across a variety of developing countries. Other important research areas are China and the transformation of economic systems, the success and failure of different economic reform strategies, and the role of international trade in economic development. 

Contact: Professor Joakim Gullstrand

Researchers in international economics and development economics

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The Department of Economics has a long tradition in macroeconomics. Recent research interests cover a wide range of topics such as monetary and fiscal policy, long run economic growth, and climate change.

In the last decades, there has been a focus on empirical macroeconomics in particular time series analysis, including the development of new econometric methods. The macroeconomic group also has strong ties to economic history with several joint collaborations.

Contact: Associate Professor Fredrik NG Andersson

Researchers in macroeconomics

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Public economics

Public economics has had a strong standing at the Department of Economics over the past 60 years. The interest in the subject derives from the early Swedish work in the area and the large public sector that arose from the creation of the welfare state in the 1900s.

There have been notable theoretical contributions to the economics of natural resources, taxation and the theory of justice as fairness and a variety of applications to areas such as industrial organization, taxation, pension systems, health economics and labour economics.

More recently, scholars from Lund have done research on areas such as the effects of taxation, public sector reform (in particular pension reform), local government in Sweden and the expansion of the welfare state. A lot of work has focused on the relationship between social trust and the welfare state, as well as on the interesting case of Sweden.

Contact: Associate Professor Andreas Bergh

Researchers in public economics

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Petter Lundborg
Professor, professor

Joakim Westerlund
Phone: +46 46 222 89 97
Room: Alfa1:4027

Hossein Asgharian
Phone: +46 46 222 86 67
Room: 4091A

Tommy Andersson
Phone: +46 46 222 49 70

Joakim Gullstrand
Professor, head of department
Phone: +46 46 222 93 97, +46 73 441 30 31

Fredrik N G Andersson
Associate professor
Phone: +46 46 222 46 44

Andreas Bergh
Senior lecturer, associate professor
Phone: +46 46 222 46 43
Room: Alfa 4101

Last published: 2019-08-19