1.1.2 Positive and Normative Statements

There is a distinction between economic statements into two types:

Positive statements:

      Objective statements that can be tested and then amended or rejected by referring to available evidence.

Normative statements:

  Subjective statements that carry value judgements,

for example saying retirement age should be set higher to combat ageing population

Value judgements have an importance that is highly emphasised as most economic decisions and policies are formed upon these, and very heavily. Such as setting working conditions.