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positive economics and normative economics

1. RK Eco Classes CONTENT MEANING : POSITIVE ECONOMICS MEANING :NORMATIVE ECONOMICS DIFFERENCE BETWEEN POSITIVE ECONOMICS AND NORMATIVE ECONOMICS

2. RK Eco Classes Positive Economics POSITIVE ECONOMICS : It deals with the economic issues related to past, present or future . It deals with such economic situations which can be studied by using facts and figures and can be verified. The positive economics is the economics of “What was, What is, and What would be”. Positive statements does not reflect any value judgement. For Example: 32 percent of population in India is absolutely poor.----(exact data- therefore positive economics)

3. RK Eco Classes Normative economics Normative Economics deals with “opinions” of the economist related to economic issues or economic problems, therefore are not verifiable for truth. The opinions involve “value judgement” and can lead to controversies and debates It is the economics of “What ought to be”. For Example: MGNREGA will one day bring an end to the problem of un employment in the country.------(opinions only- therefore normative economics)

4. RK Eco Classes Difference between positive economics and normative economics BASIS POSITIVE ECONOMICS NORMATIVE ECONOMICS MEANING It is related to past, present and future. It deals with opinions of the economists related to economic issues or economic problems. STATEMENTS It relate to “what is” and “what would be” It relate to” what ought to be”. VERFICATION FOR TRUTH It can be verified It can not be verified. VALUE JUGDEMENT Does not involve value judgement Involves value judgement EXAMPLE 32 percent of population in India is absolutely poor.----(exact data- therefore positive economics) MGNREGA will one day bring an end to the problem of un employment in the country.------(opinions only- therefore normative economics)

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