ECON 1B03 Chapter Notes - Chapter 2: Consumption Tax, Political Philosophy, Opportunity Cost

• School: McMaster University
• Department: Economics
• Course: ECON 1B03
• Professor: Mrs.Gajica

Document Summary

2 roles of an economist: scientists try to explain the world. Make positive statements which attempt to describe the world as it is try to explain the world using models with appropriate assumptions use scientific method: dispassionate development & testing of theories about how world works. Interplay between theory and observation also occurs in the field of economics. An economist might be moved by an observation to develop a theory. To test this theory, the economist could collect and analyze data, and either doubt or feel confident with his theory. difficult to experiment in economics must use whatever data the world happens to give them. Positive vs. normative: positive statements can be confirmed or refuted by evidence are descriptive. Positive views about how the world works affect normative views about what policies are desirable. Yet, our normative conclusions can"t come from positive analysis alone they involve value judgments.