Walter E. Williams

Just about the most difficult lesson for first-year economics students, and sometimes graduate students, is that economic theory, and for that matter any scientific theory, is positive or non-normative. You might ask, "What's this business about positive and normative?" It's easy. Positive statements deal with what was, what is or what will be. Normative, or subjective, statements deal with what's good or bad, or what ought to be or should be. Confusing the two leads to considerable mischief.

The statement "Scientists cannot split the atom" is a positive statement. Why? If there's disagreement with the statement, there are facts to which we can appeal to settle the disagreement -- just visit Stanford University's linear accelerator and watch atoms being split. The statement "Scientists shouldn't split the atom" is a normative statement. Why? There are no facts whatsoever to which we can appeal to settle any disagreement. One person's opinion on the matter is just as good as another's.

How about the statement "Gasoline prices are unreasonable"? If some think they're reasonable while others don't, the argument can go on forever without resolution because there are no facts to which we can appeal to settle the disagreement. However, there are facts that tend to back up the statement: Buyers of gasoline prefer lower prices while sellers prefer higher prices.

By the way, years ago, Mrs. Williams would arrive home complaining about unreasonable grocery prices. After airing her complaints, she'd ask me to unload her car full of groceries. Having completed the chore, I'd ask her whether she was unreasonable, suggesting that it was my opinion that only an unreasonable person would pay unreasonable prices. The conversation never went far in a pleasant direction.

Having explained the difference between positive and normative statements, I tell my students that in no way do I propose that they purge their vocabulary of normative statements. Normative statements are excellent tools for tricking others into doing what you want them to do. I simply caution that in the process of tricking others, there's no need to trick oneself into believing that one normative statement is better or more righteous than another.

A related term that doesn't make much economic sense is the term "need." The implication of an absolute, crying, dying or urgent need is that one cannot do without the need in question. Students sometimes say they absolutely need a car or a cell phone. At that point I ask them, how in the world was it that Gen. George Washington could defeat Britain, the mightiest nation on earth, without a cell phone or a car?


Walter E. Williams

Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of 'Race and Economics: How Much Can Be Blamed on Discrimination?' and 'Up from the Projects: An Autobiography.'
 
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