Normative and Positive

What does the "price mechanism" in a free market economy do?

It acts as a signalling device to indicate changes in consumer demand or producer supply.

Are opinion based (don't say in an exam) or "valued base" statements. A normative statement is an expression that something is right or wrong so often includes the words ought, should or better.

Normative Statement

It is good to use progressive taxation in a market economy to reduce inequality.

Normative Statement - valued judgement.

The government ought to increase the funding for overseas development.

Normative Statement - valued judgement.

The government should increase funds to the NHS in order to bring down death rates.

Normative Statement - valued judgement.

The introduction of a ban on smoking in public places is a good thing as smoking is anti-social.

Normative Statement - valued judgement.

This is a statement that cannot be tested. It is a value judgment.

Normative Statement - valued judgement.

Are statements which can be tested. They are not based on opinion. These statements are concerned with facts - that can be shown to be right or wrong. "What if"

Positive Statement

Government revenue from taxation on smoking has fallen as a result of the ban on smoking in public places.

Positive Statement - can be tested proven right or wrong.

Increasing government spending on education should increase academic achievement by students as they have access to better facilities and more resources.

Positive Statement - can be tested proven right or wrong.

Inequality is typically greater in market economy than a centrally planned economy.

Positive Statement - can be tested proven right or wrong.

Introducing a minimum wage will help to remove poverty.

Positive Statement - can be tested proven right or wrong.

Reducing state pensions will save the government money. It can then spend this money on other services.

Positive Statement - can be tested proven right or wrong.

The government should seek to reduce inflation in order to improve the UK's international competitiveness.

Positive Statement - can be tested proven right or wrong.

This is a statement that can be tested. It is free from value judgement. It can be factually correct or incorrect.

Positive Statement - can be tested proven right or wrong.