The "Credibility Revolution" in Economics: Empirical Economics meets Policymakers and Lawmakers

In recent decades, the field of economics has experienced a transformative shift in its empirical approach, now widely recognised as the “Credibility Revolution”. This shift towards evidence-based empirical analysis was meant to improve the effectiveness of interventions and raise public trust in policymaking. This article discusses the main features of the novel empirical approach and reviews the main studies in the economic literature that addressed a number of controversial issues, such as the economic effects of the statutory minimum wage, the impact of immigration on labour market outcomes and the role of firm-level bargaining on companies’ performance. While the main message of this review is that policymakers and other social scientists cannot operate without integrating an evidence-based approach for the evaluation of public policies, we remain sceptical about the real impact that the new wave of “credibility studies” had on the Italian public debate.