Fyi who studies economics economics can seem abstract

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FYI: Who Studies Economics? Economics can seem abstract at first, but it is fundamentally very practical and the study of economics is useful in many different career paths. Read this box in the book as it provides a sample of well-known individuals who majored in economics in college. Module 2.2 - The Economist as Policy Adviser Positive Versus Normative Analysis Example of a discussion of minimum-wage laws: Polly says, "Minimum-wage laws cause unemployment." Norma says, "The government should raise the minimum wage." Definition of positive statements: claims that attempt to describe the world as it is. Positive economics -- is the study of what is, and how the economy works. Positive statements have to do with fact. Examples include: 1.How does the stock market work? 2.What are the consequences of rent control on the market for housing? 3.Are the costs of having children related to family income? Typically positive economics attempt to make forecasts or make predictions about future events. Evidence (economic data) will eventually prove whether or not these were good predictions Definition of normative statements: claims that attempt to prescribe how the world should be. Normative analysis is the study of what the goals of the economy should be. Normative statements have to do with behavior norms, which are judgments as to what is good or bad. (The word "should" is a dead giveaway to a normative statement). Examples include: 1.People on welfare should work in order to get benefits 2.Inherited wealth should be taxed more heavily 3.Corporations should not be allowed to move their facilities overseas unless it is agreed to by labor unions. Positive statements can be evaluated by examining data, while normative statements involve personal viewpoints. Positive views about how the world works affect normative views about which policies are desirable. Much of economics is positive; it tries to explain how the economy works. But those who use economics often have goals that are normative. They want to
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understand how to improve the economy. Economists in Washington Economists are aware that tradeoffs are involved in most policy decisions. Economists serve as advisers in the policymaking process of the three branches of government: Legislative, Executive, Judicial. Some government agencies that collect economic data and make economic policy include: Department of Commerce -- Bureau of Labor Statistics -- Congressional Budget Office -- Federal Reserve Board -- The president receives advice from the Council of Economic Advisers (created in 1946). Module 2.3 - Why Economist Disagree Differences in Scientific Judgments Economists often disagree about the validity of alternative theories or about the size of the effects of changes in the economy on the behavior of households and firms.
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  • Spring '12
  • Green
  • Economics, production possibilities, Economists

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