Sunday, February 01, 2009
Positive Vs Normative
I am teaching two classes this semester: Intermediate MicroEconomics and Economics of Developing Areas. We talked about the difference between Positive and Normative Economics in the first week of class. Of course, the question of the Economic Stimulus and the Bailout is not far away in Economics classes and it has been a challenge to keep my normative beliefs to myself and discuss only the factual in class. I am being careful in letting my students know when I make normative claims. I would say that I am very impressed with my class and how well they have understood the difference between Positive and Normative. However, right now some of the most common oppositions to the auto bailout is because they are private companies. While most people are convinced that bailing out the auto companies is not right, they are not as convinced when we talk about bailing out individuals through subsidies and import restrictions. I guess it is easier to hate the big industrialist while being emotionally attached to the small farmer. However, once students understand that the economic logic is the same they are able to make at least a cognitive distinction and understand that the clamour for subsidies is more for emotional than economic reasoning. I am proud of my students.