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What are Positive and Normative Economics? Video Lecture | SSC CGL Tier 2 - Study Material, Online Tests, Previous Year
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| 1. What is positive economics? |  |
Positive economics is a branch of economics that focuses on objective analysis and the study of what is, rather than what should be. It deals with facts and data to understand economic behavior and predict outcomes. Positive economics aims to be value-free and unbiased, providing explanations based on empirical evidence.
| 2. What is normative economics? | |
Normative economics is a branch of economics that involves subjective judgments and opinions about what ought to be. It deals with value judgments and policy recommendations based on personal beliefs and values. Unlike positive economics, normative economics is not based solely on facts and data, but also includes ethical considerations and societal preferences.
| 3. What is the difference between positive and normative economics? | |
The main difference between positive and normative economics lies in their approach and purpose. Positive economics focuses on describing and explaining economic phenomena objectively, using data and facts. It aims to be value-free and is concerned with what is. On the other hand, normative economics involves subjective judgments and opinions about what ought to be, including ethical considerations and policy recommendations.
| 4. How are positive and normative economics used in practice? | |
Positive economics is widely used in economic research, policy analysis, and forecasting. It helps economists understand economic behavior, make predictions, and evaluate various economic policies and their potential effects. Normative economics, on the other hand, is used to guide policy decisions and debates by incorporating subjective value judgments and societal preferences.
| 5. Can positive and normative economics overlap? | |
While positive and normative economics are distinct branches, they can overlap in some cases. Positive economics provides the foundation of objective analysis and data-driven understanding, which can inform normative judgments. Normative economics, in turn, may utilize positive economic findings to support policy recommendations. However, it is important to recognize the distinction between the two and not let normative judgments influence the objective analysis of positive economics.
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