Question

26. Were early economists (Adam Smith and Karl Marx) more concerned with “positive eco- nomics” or giving normative judgements about the economic arrangements they observed? What were their respective normative positions? How different was their positive analysis?
    

Answer 1

Early economists were more leaned towards normative economics which is based on opinions. Adam Smith was advocate of free-market or laissezfaire which says that market left to itself will provide all goods efficiently. However this view of free market is capitalist and therefore Karl Marx believed that this exploits people. Therefore Karl Marx promoted Communism which says that working class should be at the first priority and the capitalist class should be sidelined. Their positive analysis were not plenty because of the lack of fact. Positive economics is based on facts. Due to lack of statistical sophistication positive economics was not so prevalent.