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Normative Economic Statement: Definition & Example

Instructor: Brianna Whiting
In this lesson we will explore the term 'normative economic statement'. We will compare and contrast normative and positive statements. We will then look at examples and provide a summary. The lesson will conclude with a quiz.

A Glimpse at Normative Economics

We all do it. That is, we all voice our opinions at one time or another. We voice our opinions on sports teams and politics. We even voice our opinions on food we like and don't like and on current fashion trends. While we all have numerous opinions, we rarely stop to think about what an opinion really is. Very seldom do we think about the kind of statement we are making every time we say something like 'The Kansas City Chiefs should go to the super bowl.' That's where this lesson on normative economic statements comes in handy.

Normative Economics Statement Defined

So what is a normative economic statement? Well, let's first define normative economics. Economics is divided into two parts, normative and positive. Normative economics pertains to opinions and judgements that cannot be tested. Positive economics, on the other hand, often entails facts that can be proven either true or false. Thus, a normative economic statement is a statement of opinion or judgment that can't be proven, and does not contain facts. These types of statements often contain words and phrases such as 'ought to' and 'should'.

Comparison

In order to fully understand normative economic statements, let's take a minute to compare positive and normative statements.

As mentioned earlier, positive statements are those that contain facts or a testable idea. Below are some examples:

-Boys wear bigger shoes then girls.

-Texas is warmer than Alaska.

-The number of people who own dogs has increased over the last five years.

-Green apples are smaller than red apples.

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