In economics, a positive statement is one that attempts to assess an objective reality without making a value judgment. For example, a study on rental costs would be an example of positive economics. A study that claims that the rent is too high is an example of normative economics. What I...
the study of what ‘ought to be’ in economics rather than what ‘is’. For example, the statement that ‘people who earn high incomesoughtto pay more income tax than people who earn low incomes’ is a normative statement. Normative statements reflect people's subjective value judgements of ...
Normative and Positive Economics When studying economics, it is important to understand when a normative or positive economic statement is being made. One type of statement is an opinion of the way the economy works and the other is a statement of fact of how the economy works. ...
Finally, the section concludes with a chapter wherein Hill interprets the Doctrine of Virtue as Kant's statement of his normative ethics. Thomas E. Hill, Jr.: Virtue, Rules, and Justice: Kantian Aspirations Yet, as is textually made explicit in texts such as the Bodhicaryavatara, Siksasam...
Economics is about choices. The manner in which the choices are perceived and presented by a decision-maker is termed: a. critical framing b. rational framing c. adjustment framing d. decision framing e. none of the above Which one of the f...
Determine whether the following statement is positive or normative: "The government should prohibit charging more than $3.00 per gallon for gasoline." Analyze the positive versus normative arguments in the following case. What statements of positive economics are used to s...
A positive statement establishes hypotheses that can be empirically tested. In contrast, a normative statement is based on opinion or subjective values. Is Positive Economics Better Than Normative Economics? Both types have their place, and on their own, both also have flaws. Integrating positive an...
To disagree with a normative statement, one can either dispute the validity of the positive information used to reach the value judgment or can argue the merits of the normative conclusion itself. This becomes a more murky type of debate since there is no objective right and wrong when it com...
Welfare economics uses the notion of optimality defined by Vilfredo Pareto. In a somewhat subtle definition, optimality is defined by a lack of a particular (‘Pareto’) type of possible improvement. An outcome is optimal if the situation does not allow for a ‘Pareto improvement.’ A Pareto ...
HowtorespondtoquestionsinEconomics Anormativestatementisavaluejudgement andstateswhatsomeonethinks‘oughttobe’. Normativestatementsaresubjectiveand influencedbypersonalbiases,background, personalpolitics Tocleanupairqualityandcutdowncarbon emissionsby25%,4x4vehiclesshouldonlybe ...