The principles of economics

Abstract

Drawing back on John Neville Keynes’ distinction between positive or regulative (normative) science, Milton Friedman (1953), had developed the methodology of positive economics, which still today dominates economic research all over the globe. Then, the question was, whether economics is a science or rather political economy, which was interpreted as an art. If economics were a science, it had to bring about a systematized knowledge about the economy, according to Friedman’s view. Whereas, if economics were an art it would be concerned with identifying rules for attaining some given end. Friedman ended the dispute and established the view that economics is a positive science, which consisted of “a body of tentatively accepted generalizations about economic phenomena that can be used to predict the consequences of changes in circumstances” (Friedman 1953: 25).