Essays in Positive Economics (Friedman, 1953)

An economist is analyzing a proposed policy to increase the national minimum wage. Which of the following statements represents a positive economic analysis, rather than a normative one?

Analyzing Economic Policy Debates

Analyze each economic statement below and match it with the correct type of economic analysis it represents.

Formulating Economic Statements

The statement, 'The current national unemployment rate of 3.7% is too high and should be lowered through government intervention,' is a positive economic statement because it refers to a verifiable statistic.

Dissecting an Economic Argument

An economic statement that can be tested and validated against data, such as 'A rise in interest rates will decrease consumer borrowing,' is an example of ______ economics.

An economic advisor is preparing a report for a government official about a proposed carbon tax. The report is structured in two main parts. Part 1 estimates the likely reduction in carbon emissions, the impact on gasoline prices, and the potential revenue generated. Part 2 argues that implementing this tax is the most equitable way to address climate change and that the revenue ought to be used to fund renewable energy projects. How would you best characterize the two parts of this report?

Connecting Normative Goals to Positive Inquiry

The Role of an Economist