This recent UC Alumni Magazine article is worth skimming. The author appears to want to sketch a long run intellectual history of the rise and fall of the Chicago School of Economics.
The article quotes the usual suspects. All are Superstar economists and I enjoyed reading their quotes. But, the "Chicago School" (adding up economists at UC's Economics Dept, Business School, Policy School, Social Work School, Law School, and Medical School) probably includes 100 PHD economists. It is difficult to take such a diverse set and boil them down to a 2 sentence "catch-all".
At the end of the day, 80% of the flow of new research is generated by assistant professors. This article would have been much stronger if the author had spoken to some junior UC professors about their research agendas because their work represents the leading indicator of where academic economics is going.
In the article, Jim Heckman sketches a novel claim. If I'm reading his words correctly, he says that the rise of blogs and the desire by applied micro researchers to be famous has tantalized us to substitute to a set of questions and quick answers that offer short run gratification but slows down the long run progress of economic science. Are many academics so impatient for fame? Has the anticipation that a sexy NBER Working Paper will yield world headlines and (hence immediate gratification), affected our ex-ante investment behavior in the set of questions we work on? I go back and forth on whether I believe this.
I believe in comparative advantage. Clint Eastwood said; "A Man Has to know his limitations." There are very high returns within the profession for doing structural econometric research. Think of John Rust or Kenneth Wolpin. These guys have had great careers. But, not everyone can master these skills. What should happen to us "slugs"? Banishment? Why can't we academic economists celebrate diversity like everyone else at the University? UCLA Economics is one of the few departments with an ecosystem featuring both types of applied micro researchers. Other programs have tipped in one direction or the other.
The reduced form crowd can generate some very interesting facts but cannot conduct any policy counter-factuals. The structural crowd can yield policy counter-factuals if you buy their model's assumptions. There is no free lunch. Who is the economist here?