Economics as a social science

What is a positive statement?

A statement that can be tested by looking at evidence and either proved as a fact or refuted

What are some examples of positive statements?

• a rise in the rate of interest will, Cerberus paribus, cause a rise in the exchange rate

• The UK economy now has lower unemployment than Germany

• Inflation is 2.4% in the UK

What is a positive statement?

A statement that can be tested by looking at evidence and either proved as a fact or refuted

What are some examples of positive statements?

• a rise in the rate of interest will, Cerberus paribus, cause a rise in the exchange rate

• The UK economy now has lower unemployment than Germany

• Inflation is 2.4% in the UK

What is a normative statement?

A statement which cannot be proved or tested using evidence. It’s a value judgement.

What is the ceteris paribus rule?

Meaning all other things (ceteris) remaining constant (paribus)

Why is economics regarded as a social science?

People are unpredictable so it uses scientific methods to build theories that can help explain the behaviour of individuals, groups and organisations

Why is it argued that economics cannot be a science?

It studies human behaviour and human behaviour cannot be reduced to scientific laws

What research methods can economists use?

Observation, deduction and the construction of models in order to look at the impact aswell as stats and theories of behaviour

What is meant by the term economic model?

A simplified view of complex relationships and processes