Confronting Objections to the Economic Approach

Self-Check Questions

Individuals may not act in the rational, calculating way described by the economic model of decision making, measuring utility and costs at the margin, but can you make a case that they behave approximately that way?


When individuals compare cost per unit in the grocery store, or characteristics of one product versus another, they are behaving approximately like the model describes.

Would an op-ed piece in a newspaper urging the adoption of a particular economic policy be a positive or normative statement?


Since an op-ed makes a case for what should be, it is considered normative.

Would a research study on the effects of soft drink consumption on children’s cognitive development be a positive or normative statement?


Assuming that the study is not taking an explicit position about whether soft drink consumption is good or bad, but just reporting the science, it would be considered positive.