Welcome back you bunch of HomoEconomicus! Today, we will be exploring the differences between positive and normative economic statements.
So, a while ago I conversed with my great friend Muhammad about economics as we so often do. We were debating the nature and definition of positive and normative statements, as well as how they apply to Micro and Macro. I grudgingly hate to admit I was wrong but he corrected my failure of understanding. Here are the facts, so you do not make the same terrible mistakes.
A positive economic statement is a FACT! Facts are based on empirical evidence which is scientifically provable. It is
A normative statement is entirely based on value judgments and the endorsement of individuals. They are based on opinions so cannot be disproved.
Essentially, positive states the facts and normative provides a value
So that is that… and never make the same mistake twice!
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