Micro 1.1-Normative vs. Positive Sort #1

Last updated about 1 year ago

1 Asɛmmisa

Def. 1

Economists frequently distinguish between 'positive' and 'normative' economics. Positive economics is concerned with the development and testing of positive statements about the world that are objective and verifiable. Normative statements derive from an opinion or a point of view.

Def. 2

Positive statements are statements about economics which can be proven true or false by evidence. Normative statements are statements which cannot by supported or refuted as they are value judgements, i.e. Opinions, about how economies and markets should work. ... Normative economics is concerned with value judgements.

Mr. B's Definition....

Normative Statement...You want society to normalize to your thinking...which is opinionated. "SHOULD" or "OPINION"

Positive Statement....You make a claim which can be positively verified with fact. "DATA" or "ACCEPTED THEORY"

Sort the following based on whether the statement is a normative or a positive statement.

In a survey of 464 economists, only 6.5% disagreed with the statement “A ceiling on rents reduces the quantity and quality of housing available.”
Government should provide basic healthcare to all citizens.
The U.S. unemployment rate is 5.1%
“The distribution of income in the U.S. should be more equal.”
A car scrappage scheme will lead to fall in the price of second hand cars.
Pollution is the most serious economic problem.
Unemployment is more harmful than inflation.
Government-provided healthcare increases public expenditures (spending).
A fall in incomes will lead to a rise in demand for own-label supermarket foods.
The U.S. unemployment rate should be lower

Normative Statement
Positive Statement