Professor Ruud is a theoretical econometrician.  While empirical econometricians deal more with specific data sets and finding the best econometric model to apply to those sets, Ruud and other theoretical econometricians are more concerned with improving on existing econometric models.  Their work involves much more abstract mathematics.  For example, many models, or properties of these models, are based on assumptions. Professor Ruud might try to take away one of these assumptions and see how the model or the statistical properties change.

        Econometricians have been applying the same basic set of models to their problems for about 40 years.  Professor Ruud’s research is more geared towards developing these models.  After improving on a model, he then offers his enhanced model for empirical econometricians to use should it suit their needs.  For example, one model Professor Ruud has worked on has made it
easier to analyze discrete choices, such as choosing which car to buy.  Such problems were previously much more difficult to analyze statistically using existing models.
 

        Professor Ruud usually does not look for research questions to pursue. Rather, they usually come to him.  He has been working in the same few fields for a long time, and so he is already aware of many existing problems that he would like to work on.  Occasionally, he also develops questions while simply reading something that makes him a little curious.  The problems Professor Ruud would like to analyze are sometimes too general, however, so then he asks more specific questions in order to find an answer he can apply to the general question.

        Since he deals with the abstract math of the econometric models, Professor Ruud does not often use specific data sets.  When the need does arise, though, Professor Ruud usually locates the data he is looking for from government agencies, such as regulators.  Occasionally, he is also involved in the data collection itself.  However, it is typically the empirical econometricians who use specific data sets, when applying the models that Professor Ruud and other theoretical econometricians have supplied.