distinguish between positive and normative economics
Answers
Basis for Comparison between Positive Economics vs Normative Economics Positive Economics Normative Economics
1. Meaning Positive economics concentrates on what already are – the facts, the verifiable. Normative economics depicts a picture of what should be – the opinions, the prescriptions of economists & experts.
2. What it’s all about? Positive economics talks about the cause and effect relationship. Normative economics talks about the opinions and judgments.
3. Nature of the branch The nature of positive economics is factual and descriptive. The nature of normative economics is prescriptive.
4. Type of argument behind Type of argument behind positive economics is objective. Type of argument behind normative economics is subjective.
5. Merit of testing Statements under positive economics can be tested and the right/wrong can be found. Statements under normative economics can’t be tested or verified.
6. Needed because Positive economics points out the thing as it is so that a judgment can be passed based on that fact. Normative economics passes opinions on the facts presented in positive economics.
7. Based on Facts, reality. Values.
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QUESTION :-Difference Between Positive and Normative Economics ?
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positive vs normative economicsEconomics is a science as well as art. But which type of science is a big question here, i.e. positive or normative? Positive economics is related to the analysis which is limited to cause and effect relationship. On the other hand, normative economics aims at examining real economic events from the moral and ethical point of view. It is used to judge whether the economic events are desirable or not.
While Positive economics is based on facts about the economy. Normative economics is value judgment based. Most of the people think that the statements which are commonly accepted are a fact but in reality, they are valued. By, understanding the difference between positive and normative economics, you will learn about how the economy operates and to which extent the policy makers are taking correct decisions.
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