There is little doubt that "big data" will change the landscape of economic policy and economic research. Something worth noting however is that big data will not be a substitute for common sense, economic theory, or the need for careful research designs. This may come as a shock to many economics students who these days are taught that all economics amounts to is pushing the "regress" button and picking whatever results confirm your prejudices. Data is a complement to real economics. In the case of "big data" how exactly remains to be seen. Einav and Levin look at the opportunities, as well as challenges, that come with the ongoing data revolution.
The abstract reads
Many believe that "big data" will transform business, government and other aspects of the economy. In this article we discuss how new data may impact economic policy and economic research. Large-scale administrative datasets and proprietary private sector data can greatly improve the way we measure, track and describe economic activity. They also can enable novel research designs that allow researchers to trace the consequences of different events or policies. We outline some of the challenges in accessing and making use of these data. We also consider whether the big data predictive modeling tools that have emerged in statistics and computer science may prove useful in economics.