Economic Methodology Flashcards
What is economics?
The study of how the worlds scarce resources are allocated to satisfy societies wants.
What is a social science?
A branch of science which studies societies and the relationships amongst individuals in those societies.
What is a natural science?
A branch of science that studies the physical works - such an biology, chemistry & physics
What type of science is economics?
A social science
What is scientific methodology?
The process of objectively establishing facts through testing and experimentation - data driven.
What is a positive economic statement?
Objective statements that CAN be tested against facts to be declared either true or false.
What is an normative economic statement?
Subjective opinions that CANNOT be tested against facts.
Do positive economic statements always need to be true?
Not necessarily
What do normative economic statements consist of ?
People’s political standpoints & views & ethics. Carry value judgements.
What is a value judgement?
An evaluative statement of how good or bad you think an idea is, influences government economic policies.
