1.1.2 Positive and Normative statements

What are the features of a positive statement?

• Deals with facts

• Are either true or false

• Can be scientifically proven to be true or false by looking at facts and seeing whether or not they support the statement

• They are objective

What are the features of a normative statement

• Deals with opinions

• Cannot scientifically be proven true or false

• Known as ‘value judgements’

• Are subjective

What is the role in value judgements in economic decision making

They have major influences of both consumers and producers and government policy making.

For example a government might prefer to cut income tax rather than increase expenditure on healthcare provision. This could be due to an underlying preference for the operation of free market forces rather than more government interventions in an economy.