1.1 Economic Methodology Flashcards
What is Normative economics?
About value judgments and views(can’t be scientifically tested)
What is a positive statement?
A statement that can be tested to see if it is correct
What is economics the study of?
Choice and decision making in a world with limited scarcity of resources
What is economising?
The study of how people make choice about
-how to produce
-what to produce
-whom to produce for
What are the steps of scientific methodology?
-observe consumer behaviour in the market place
-form a hypothesis to explain how consumers spend their money
-developing prediction on these hypothesis
-use evidence to test the predictions
-conclude evidence supports the hypothesis or it doesn’t
What is a lot of economic concerned with?
What people ought to do
What type of statement includes words such as
-ought and -should
Normative statements
What actually is a value judgment?
About wether something is desirable or not
When do governments make value judgments?
When deciding on legislation and economic policy
What do governments claim about their value judgments?
They have the moral right to do so
Why do governments claim they have the moral right to make value judgments?
The manifesto before the election and supported by voters gives them the mandate to do so
