The Economists' Tool Kit
Read this section and its learning outcomes, which should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of the section before checking the answers.
Key Takeaways
- Economists try to employ the scientific method in their research.
- Scientists cannot prove a hypothesis to be true; they can only fail to prove it false.
- Economists, like other social scientists and scientists, use models to assist them in their analyses.
- Two problems inherent in tests of hypotheses in economics are the all-other-things-unchanged problem and the fallacy of false cause.
- Positive statements are factual and can be tested. Normative statements are value judgments that cannot be tested. Many of the disagreements among economists stem from differences in values.