2. 1 Positive and Normative Statements

Statements

Economists give two broad types of advice, called normative and positive

For example, they sometimes advise that the government ought to try

harder to reduce unemployment. When they say such things, they are

giving normative advice; in this case, they are making judgments about

the importance of unemployment and the value in the government

addressing it. Advice that depends on a value judgment is normative—it

tells others what they ought to do.

Another type of advice is illustrated by the statement “If the government

wants to reduce unemployment, reducing employment insurance benefits

is an effective way of doing so.” This is positive advice. It does not rely on

a judgment about the value of reducing unemployment. Instead, the

expert is saying, “If this is what you want to do, here is a way to do it.”

Normative statements depend on value judgments and cannot be

evaluated solely by a recourse to facts. In contrast, positive statements

do not involve value judgments. They are statements about matters of

fact, and so disagreements about them are appropriately dealt with by an

appeal to evidence. The distinction between positive and normative is

fundamental to scientific progress. Much of the success of modern science

depends on the ability of scientists to separate their views on what does

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