Normative Theory Versus Positive Theory

In general, a positive theory is a theory that attempts to explain how the world works in a value-free way, while a normative theory provides a value-based view about what the world ought to be like or how it ought to work; positive theories express what is, while normative theories express what ought to be. Each of the social sciences, but particularly economics, has advanced both positive theories and normative theories. In economics, positive theories attempt to explain how the economy actually operates and include, for example, the basic supply and demand models of microeconomics as well as the macroeconomic theories of Keynesian economics and the theory of comparative advantage of David Ricardo. Normative economic theories typically propose a goal at which economies should aim. For example, early welfare economists (e.g., Alfred Marshall and Arthur C. Pigou) proposed the goal of maximizing utility, while their followers (e.g., John R. Hicks and Znicholas Kaldor) were forced by the problem of interpersonal comparisons of utility to retreat to the less ambitious goal of Pareto efficiency. Political science has also advanced both positive and normative theories, as has jurisprudence, psychology, sociology, anthropology, and business ethics. In business ethics, for example, stakeholder theory has developed both as a normative theory (a theory of the stakeholders businesses ought to take into account) and as a positive theory (a theory of the consequences business face if they do not take stakeholders into account). Positive and normative theories are often linked, particularly in discussions of public policy. For example, in the model of the perfectly competitive market, a positive theory played a key role in discussions of how antitrust law could achieve the normative goals of welfare economics. More generally, positive theories are said to show us the means to the public policy ends that normative theorists advance. A key discussion has centered on the question of whether the distinction between positive theory and normative theory is viable, a question that is closely related to whether the fact-value or is-ought dichotomy is viable. Some have argued that the selection of the questions that a positivistic social scientist will investigate, the methods the scientist will use, and assumptions about what counts as appropriate evidence and adequate measurements are all based on the background cultural and social values of the scientist, and so theories resulting from the investigation will be value laden and thus normative. Others have claimed that because theories must be expressed in language and language is value laden, even putatively positive theories must be normative. John Searle has argued, for example, that institutional concepts are inherently both descriptive and normative. If this is true, then allegedly positive social science theories that make use of institutional concepts—such as “money,” “legal,” “economy,” “government,” “property,” and “marriage”—must also be normative. Several feminist philosophers of science have argued that many so-called positive theories in the sciences turn out, on inspection, to derive from assumptions that are subtly, or not so subtly, based on gendered values.