Asymptotic theory is a branch of statistics that focuses on the behavior of estimators and test statistics as the sample size approaches infinity. It helps statisticians understand how certain methods perform in large samples, providing insights into their efficiency and consistency. This theory often involves concepts like convergence in distribution and asymptotic normality, which describe how the distribution of an estimator becomes more predictable as more data is collected. By using asymptotic results, researchers can make approximations that simplify complex calculations, making it easier to draw conclusions from large datasets.