Question

Distinguish between positive and normative economics with examples.

Answer 1

The distinction between positive economics and normative economics may seem simple, but it is not always easy to differentiate between the two. Positive economics is objective and fact based, while normative economics is subjective and value based. Positive economic statements must be able to be tested and proved or disproved. Normative economic statements are opinion based, so they cannot be proved or disproved. In fact,  many widely accepted statements that people hold as fact are actually value based.

For example, the statement, "government should provide basic healthcare to all citizens" is a normative economic statement. There is no way to prove whether government "should" provide healthcare; this statement is based on opinions about the role of government in individuals' lives, the importance of healthcare, and who should pay for it.

Answer 2

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$\bf{Here\: is\: your\: answer.}$

$<b>Positive economics is objective and fact based, while normative economics is subjective and value based. Positive economics statements must be able to be tested and proved or disproved.Normative economic statements are opinion based, so they cannot be proved or disproved.An example of a normative statement would be “Higher inflation is bad.”, but this isn't solely an economics statement, but a statement based on the individuals political preferences. Positive economics is objective and fact based, while normative economics is subjective and value based.$


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