Essays in positive economics

In this admirable book on The Scope and Method of Political Economy John Neville Keynes distinguishes among "a positive science...a body of systematized knowledge concerning what is; a normative or regulative science...a body of sys tematized knowledge discussing criteria of what ought to be ; an art ...a system of rules for the attainment of a given end"; comments that "confusion between them is com mon and has been the source of many mischievous errors"; and urges the importance of "recognizing a distinct positive science of political economy."¹

This paper is concerned primarily with certain methodological problems that arise in constructing the "distinct positive science" Keynes called for-in particular, the problem how to decide whether a suggested hypothesis or theory should be tentatively accepted as part of the "body of systematized knowledge con cerning what is." But the confusion Keynes laments is still so rife and so much of a hindrance to the recognition that econom ics can be, and in part is, a positive science that it seems well to preface the main body of the paper with a few remarks about the relation between positive and normative economics.