Positive and Normative Statements

Positive Statements

Positive statements are about facts. They describe what is, what was, or what will be.

They can be tested to see if they are true or false by looking at evidence.

For example, “Raising the tax on cigarettes will reduce cigarette consumption.”

This is a testable statement about cause and effect.

Normative Statements

Normative statements are based on opinions or beliefs about what should happen.

They cannot be tested or proven true or false.

For example, “The government should raise the tax on cigarettes because it is good for public health.”

This is a value-based statement, not a fact.

Value Judgements

Behind every normative statement is a value judgement — a belief about what is right or wrong.

Value judgements often influence government policies and economic decisions.

For instance, two economists might agree that a higher tax reduces smoking (a positive statement)

but disagree on whether that is a good thing for society (a normative judgement).

Economists aim to separate facts from opinions.

They use positive analysis to explain what will happen,

but decisions about what should happen depend on value judgements.