Examples of positive statements in economics - FreeEconHelp.com, Learning Economics... Solved!

7/13/18

Examples of positive statements in economics


Positive statements tend to focus on statements about what is instead of opinions or what ought to be (a normative statement). In economics we tend to view our study as exploring questions about the truth and the way that people behave. We make guesses about behavior that people engage in. In order to make these guesses, economists will create hypotheses or predictions about the causes and outcomes. These hypotheses are testable and are descriptions of the behavior. The fact that the hypotheses can be found to true or not, and explored with evidence makes it a positive statement.
Let’s go through some examples of statements to see whether they are indeed positive or are instead normative in nature.


1. NFL TV ratings are too high.

Can this statement be tested? In a way we could explore what the ratings of the NFL are, but there is no standard way to explore whether the ratings themselves are too high or not. Therefore, this is a normative statement. However, if we were to change the wording to:

2. NFL ratings are lower this year compared to last year.

We can see that the above statement IS a positive statement because it is testable by looking at the ratings over the two years and then exploring whether one is larger/smaller/the same as the other.

3. Tiger Woods is the best golfer of all time.

This is not an example of a positive statement because it cannot be tested in a meaningful way. The definition of best is not defined in a way that allow for the statement to be true or not. However, we could change the wording to:

4. Tiger Woods has won the most championships of any golfer.

This is a positive statement because we can test whether or not it is true by counting the number of championships won and comparing it to every other golfer.

5. A 15 dollar per hour minimum wage is necessary for a civil society.

This is not a positive statement because it is an opinion and it is impossible to test what exactly is necessary for a civil society to exist. However…

6. A 15 dollar per hour minimum wage raises average wages for a local economy.

Do minimum wage increases raise unemployment?
This is a positive statement because we could test averages wages in an area both before and after the minimum wage went into effect. Another example:

7. A 15 dollar per hour minimum wage increases unemployment for the local area.

This is another example of a positive statement and not a normative statement because it is testable. We can explore the unemployment rate of the area both before and after the new higher minimum wage to see if it actually changed or not (and it which direction).

8. The video game Fortnite is addicting.

This is a normative statement as it is not testable in any meaningful way, however we could say that

9. Fortnite the video game has over 10 million players.

Which is a testable statement as we could count the number of players to see whether or not it is a true statement or not.

10. Is the song Happy Birthday the most popular song throughout the history of mankind.

This is a normative statement because most popular is not a testable statement but we could make a small change to this and get a positive statement that is testable.

11. The song Happy Birthday was the most searched song title in Google this past year.

12. Free trade agreements tend to make everyone better off.

This is a subjective statement that is nearly impossible to test. However, we could consider the following.

12. Countries that engage in free trade deals typically see a growth in their GDP per capita.

This is testable, because we can look at GDP per capita both before and after the free trade agreement was made.

So as you can see, while there are infinite examples of positive statements the main thing that you need to keep in mind is that every positive statement is statement of something “that is”. This means that you should focus on statements that are either true or not and are testable in a repeatable sort of way that would have everyone agree on the interpretation of the evidence. What I mean here is that the testing metric should be something that is fairly standard and understood by everyone. For example, saying that President Trump is the worst president is not a positive statement because people could disagree on what the definition of “worst” is in this scenario. However, saying that President Trump had the highest approval rating of any United States president is testable and understandable by most people meaning that it would make a good positive statement.

To summarize: a positive statement is a statement of “what is” vs. a statement of what “should be” which is normally thought of as a normative statement. A good rule of thumb is to ask yourself if the statement can be proven true or false (tested) in a relatively easy way and understood by most. If it can, it is likely a positive statement (which economists tend to support and follow in most of their research).


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