normative economics


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normative economics

the study of what ‘ought to be’ in economics rather than what ‘is’. For example, the statement that ‘people who earn high incomes ought to pay more income tax than people who earn low incomes’ is a normative statement. Normative statements reflect people's subjective value judgements of what is good or bad and depend on ethical considerations such as ‘fairness’ rather than strict economic rationale. The actual economic effects of a taxation structure that taxes the rich more heavily than the poor (on spending and saving, for example) is a matter for POSITIVE ECONOMICS. See WELFARE ECONOMICS.
References in periodicals archive ?
Only in a philosophy at the polar opposite of standard normative economics could the state claim parenthood over adult citizens.
This article discusses how this anomaly manifests itself in Jamaica's valuation practice, explains how the valuer's reliance on normative economics contributes to this situation, and presents recommendations for improving valuation standards and accuracy.
Heyne agrees with Tiemstra that the bright line that many economists see between positive and normative economics does not exist.
Yes, indeed, there is a difference in the definition between positive economics, describing what is, and normative economics, describing what should be.
5) Dooyeweerd will be characterized as an outspoken advocate of normative economics, both in a scientific and in an everyday context.
Utilitarianism and normative economics are often confused, according to Posner.
Mosini asserts that F53 makes two related claims: (1) positive and normative economics are distinct, and (2) positive analysis is independent of normative concerns, but normative concerns are dependent on positive analysis.
The work "Wealth of Nations" also provided the distinction between positive economics and normative economics to occur.
Economists typically make a distinction between positive and normative economics.
Some of these writers have also rebelled against mainstream attempts to distinguish sharply between positive economics and normative economics.
This type of analysis involves normative economics which includes policy economics.
It is the interaction of the two branches of economics, positive economics, which uses substantive rationality, and normative economics which uses ontological rationality.