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Home » Finance Interview Questions » General Interview Questions » In economics what is a normative statement?

In economics what is a normative statement?

A normative statement in economics is like a normative statement in any other academic subject--it is a statement about something with an implicit value judgment or moral claim.

It is distinct from a descriptive statement that is supposed to be value/ideologically neutral.

For example, a descriptive statement in economics could be something like, 'Social Security is set to go bankrupt by 2050.' Whereas a normative statement would be something like, 'Social Security is set to go bankrupt by 2050 and thus must be saved to prevent a huge boom in elderly poverty.'



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