ABSTRACT
This chapter examines the relationship between economic theory and the evidence used to support or weaken it. This relationship is highly contested and has been since the birth of modern economics. The chapter revisits a number of episodes in the history of economics in order to illustrate that the relationship between theory and evidence has been at the centre of the methodological debate from the heyday of classical economics onwards. It will then argue that there is no consensus on the issue in contemporary economics either. The final section presents some speculation about where this debate might go in the future.
