Difference between Positive and Normative Economics
The major differenced between Positive and Normative Economics are listed below in Table
| Basis of Differences | Positive Economics | Normative Economics |
|---|---|---|
| Definition | The economics which studies the things as they are found in reality is called positive economics | The economics which uses value judgement is called normative economics |
| Inquiries | It inquires as 'what is', 'what was', 'what will be'? | It inquires as 'what ought to be'? |
| Analyse | It explains cause and effect relationship between economics issues. | It makes decision on any economic issues without analysis. |
| Use of assumption | Makes some assumptions while making economic analysis. | It doesn't make any assumptions while carrying out economic analysis |
| Results | Its results are widely applicable. | Its results are applied to specific issues |
| Supporters | Positive economics was supported and led by classical and modern economists | Normative economics was supported and led by Neo-classical economists |
| Example | If students become frequently absent in the class, they may fail in the exam. | Student should not leave their regular classes. |