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Positive economics focuses on the description, quantification and explanation of economic phenomena. [1] Normative economics often takes the form of discussions about fairness and what the outcome of the economy or goals of public policy ought to be, as well as prescriptions regarding rational choice (in decision theory). [2]
Normative has specialized meanings in different academic disciplines such as philosophy, social sciences, and law. In most contexts, normative means 'relating to an evaluation or value judgment.' Normative propositions tend to evaluate some object or some course of action. Normative content differs from descriptive content. [3]
Mainstream economics is the body of knowledge, theories, and models of economics, as taught by universities worldwide, that are generally accepted by economists as a basis for discussion. Also known as orthodox economics , it can be contrasted to heterodox economics , which encompasses various schools or approaches that are only accepted by a ...
The essay argues that economics as science should be free of normative judgments for it to be respected as objective and to inform normative economics (for example whether to raise the minimum wage). Normative judgments frequently involve implicit predictions about the consequences of different policies.
Law and economics, or economic analysis of law, is the application of microeconomic theory to the analysis of law.The field emerged in the United States during the early 1960s, primarily from the work of scholars from the Chicago school of economics such as Aaron Director, George Stigler, and Ronald Coase.
[1] [4] [5] But the normative economics of social decision-making is typically placed under the closely related field of social choice theory, which takes a mathematical approach to the aggregation of individual interests, welfare, or votes. [6] Much early work had aspects of both, and both fields use the tools of economics and game theory ...
Normative legal theories are highly evaluative and are entwined with moral and political theories. An example that highlights the differences between positive legal theory and normative legal theory is presented through a comparison of their approaches to tort law. Whilst positive theory seeks to explain what causal forces have produced the ...
New institutional economics (NIE) is an economic perspective that attempts to extend economics by focusing on the institutions (that is to say the social and legal norms and rules) that underlie economic activity and with analysis beyond earlier institutional economics and neoclassical economics.