Positive economics
From Wikipedia, the free encyclopedia
Positive economics, value-free economics or wertfrei economics (from the German wertfrei, meaning value-free) is the part of economics that focuses on facts and cause-and-effect relationships. It includes descriptions, development and testing of economics theories.
Positive economics attempts to avoid value judgments. It tries to establish scientific statements about economic behavior and deals with descriptive statements of economic phenomena. For example, a positive economic theory might describe how interest rate affects inflation but it does not provide any guidance on whether what policy should be followed.
Such scientific-based analysis is critical to normative economics, the ranking of economic policies or outcomes as to acceptability. Positive economics is sometimes defined as the economics of "what is", whereas normative economics discusses "what ought to be". The distinction was exposited by John Neville Keynes (1891) and elaborated by Milton Friedman in an influential essay (1953).
The metholodogical basis for a positive / normative distinction has its roots in the fact-value distinction in philosophy, the principal proponents of such distinctions being David Hume and G. E. Moore, although an older intellectual lineage can be traced to Aristotle. The logical basis of such distinctions has been disputed in the philosohpical literature e.g. by Hilary Putnam. Such debates are reflected in discussion of positive science and specifically in economics, where critics, such as Gunnar Myrdal dispute the idea that economics can be completely neutral and agenda-free, as positive economics sets out to be. The pursuit of positive economics is often linked to the adoption of logical positivist epistemology in economics, although it can be argued that the positive economics project can encompass a broader of range of epistemological positions than this.
[edit] See also
[edit] References
- Milton Friedman (1953), Essays in Positive Economics, ch. 1
- Stanley Wong (1987), “positive economics," The New Palgrave: A Dictionary of Economics, v. 3, pp. 920-21
[edit] External links
"The Methodology of Positive Economics" (1953), excerpts from Friedman's essaysk:Pozitívna ekonómia
