Syllabus: Cambridge - International AS & A Level Economics
Module: 1.2 Economic Methodology
Lesson: 1.2.2 Positive and Normative Statements
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Introduction
Positive and normative economics form a foundational part of the Cambridge International AS & A Level Economics syllabus (code 9708), specifically in Topic 1.2.2 of the “Economic Methodology” section. This distinction plays a critical role in shaping students’ understanding of how economic arguments are constructed, interpreted and debated.
Understanding the difference between objective (positive) statements and subjective (normative) judgments is vital for developing analytical skills. This topic supports wider commercial awareness by training students to recognise value judgements within economic and policy debates—a skill increasingly required across academic subjects, workplaces and public life.
Key Concepts
In line with the official Cambridge specification, the following are the core content areas for 1.2.2:
Positive Statements: Statements that can be tested, proven or disproven by evidence. They are objective and fact-based.
Example: “An increase in interest rates reduces consumer spending.”
Normative Statements: Statements that involve a value judgement and cannot be tested or validated purely by evidence.
Example: “The government should increase spending on healthcare.”
The Role of Value Judgements: Students must understand how value judgements underpin economic decision-making, particularly in government policy and resource allocation.
Distinguishing Between the Two: The syllabus expects learners to identify whether a given statement is positive or normative, and explain why.
The Importance of Objective Analysis: Encouraging students to approach debates with clear reasoning and recognition of bias, enhancing their ability to write analytically.
These concepts underpin later topics in macroeconomics and market failure, where policy analysis depends on this foundational understanding.
Real-World Relevance
Distinguishing between positive and normative statements is more than academic—it’s a critical life skill.
Example 1: Government Spending on Education
Positive: “UK government spending on education was £110bn in 2024.”
Normative: “The government should increase spending on vocational training.”
This distinction helps students critically evaluate claims made by politicians, businesses or media commentators.
Example 2: Cost of Living Crisis
Positive: “Inflation reached 5.8% in the UK in 2025.”
Normative: “The Bank of England must intervene to prevent further cost of living increases.”
This example links directly to current affairs, encouraging students to apply economic thinking in real-time contexts.
Encouraging these comparisons in class builds commercial awareness by framing real policy issues through an economic lens.
How It’s Assessed
In Cambridge International exams, this topic is commonly assessed through structured and multiple-choice questions. Expect:
Command Words: Identify, distinguish, explain, evaluate
Short Answer Tasks: “Distinguish between positive and normative statements, using examples.”
Application Questions: Based on a policy scenario or economic news snippet, requiring students to classify statements or evaluate their implications.
Examiners reward clarity of explanation and correct use of economic terminology. Clear differentiation between positive and normative analysis is often a basic requirement before progressing to higher-level evaluation.
Enterprise Skills Integration
This topic is deeply aligned with two key enterprise skills: decision-making and critical thinking.
Problem-Solving: Students practise weighing up competing arguments and evidence before reaching conclusions.
Strategic Thinking: They learn to identify when opinions are being masked as facts—vital in commercial settings like marketing, management, or policy evaluation.
Workplace Relevance: In any professional context, the ability to separate data-driven reasoning from bias improves decision-making.
These skills are embedded in Enterprise Skills’ simulation-based learning, where students regularly apply objective and subjective reasoning under time pressure.
Careers Links
Understanding positive and normative economics is explicitly linked to Gatsby Benchmark 4, which focuses on connecting curriculum learning to careers.
Related Careers:
Policy Advisor
Market Analyst
Economist
Management Consultant
Journalist (Economics or Politics)
Public Sector Strategist
Workplace Applications:
Analysing cost-benefit outcomes in project planning
Evaluating stakeholder impact in commercial proposals
Justifying business cases with evidence
Enterprise Skills’ “Skills Hub Futures” provides ready-to-deliver sessions that align with this concept, developing commercial awareness and workplace reasoning across all career paths.
Teaching Notes
Top Tips for Delivery:
Use live headlines from the news to generate student examples (e.g. taxation, climate policy, NHS funding).
Run a classroom debate where half the class must speak only in positive terms, the other half only in normative terms.
Encourage group annotation tasks using economic articles or policy papers, identifying which parts are fact-based versus value-laden.
Common Pitfalls to Avoid:
Students often confuse ‘normative’ with ‘incorrect’. Reinforce that normative doesn’t mean false—it simply cannot be tested.
Lack of application: Ensure students can generate original examples, not just memorise definitions.
Failure to recognise mixed statements: Teach students that many real-world statements contain both elements.
Extension Ideas:
Invite students to draft their own economic policy proposal, clearly separating positive evidence from normative conclusions.
Incorporate elements of commercial awareness by exploring how businesses use normative language in advertising and lobbying.
Recommended Tools:
Skills Hub Business and Skills Hub Futures modules on “Understanding Stakeholders” and “Evaluating Business Decisions” link directly to this topic.
