In 1992, Lau was named the first Kwoh-Ting Li Professor of Economic Development at Stanford University. From 1992 to 1996, he served as a Co-Director of the Asia-Pacific Research Center of Stanford University. From 1997 to 1999, he served as the Director of the Stanford Institute for Economic Policy Research (SIEPR) of Stanford University. His specialized fields are Economic Development, Economic Growth, and the Economies of East Asia, including China. He developed one of the first econometric models of China in 1966, and has continued to revise and update his model since then.