Concept

Normative economics

Summary
Normative economics (as opposed to positive economics) is the part of economics that deals with normative statements. It focuses on the idea of fairness and what the outcome of the economy or goals of public policy ought to be. Economists commonly prefer to distinguish normative economics ("what ought to be" in economic matters) from positive economics ("what is"). Many normative (value) judgments, however, are held conditionally, to be given up if facts or knowledge of facts changes, so that a change of values may be purely scientific. On the other hand, welfare economist Amartya Sen distinguishes basic (normative) judgements, which do not depend on such knowledge, from nonbasic judgments, which do. He said, "no judgments are demonstrably basic" while some value judgments may be shown to be nonbasic. This leaves open the possibility of fruitful scientific discussion of value judgments. Positive and normative economics are often synthesized in the style of practical idealism. In th
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