okay uh for today leure we will discuss uh another uh type of analysis uh which is we call as the normative analysis I would like to recap uh what we have discussed uh in the last class related to tools of uh positive analysis if we go if we try to uh if we try to recall back to what we have been discussed uh uh in our last lecture related to tools of uh positive analysis uh positive analysis is all about uh methodology what we can do to come out the evidence about the subject the subject here can be the policy either the policy either we can come up with evidence to say the policy is good or not good okay it is all about the evidence and then how we elaborate the evidence and then to give a tangible uh a tangible explanation about the impact whatever policy that have been made by the government and its impact on uh Society especially when we talk about the objective of a government in uh in making tion about the expenditure about the policy in order to increase the welfare okay now we look at the tools of uh normative analysis different with tool of positive analysis normative analysis uh is not about the evidence it's about the argument it's about the critical review about one uh it can be a one policy it can be the that we got reflect to what policy that have been decided by the government and then from that we come up with the normative analysis or normative statement we need to come up with the normative analysis first then we can develop the normative statement this is what it mean so what does it mean by the normative statement here is the normative statement is all about the the the argument about where whether the policy can be improved or about whether the uh the whether the situation from a conrete evidence can be improved okay let's say we are looking at the uh policy that is being implemented then the normative analysis can be used to explain what is the benefit it also can be used to explain what is the uh uh the adverse impact that uh will that is or will happen uh in the economy okay so when you to when we look at the context of Public Finance uh we focus on how to develop a positive statement how we going to uh make a normative analysis to focus on whether or not the economy produce a socially desirable result I told you when we discuss about uh the uh the topic of Public Finance we just think about only one objective uh which is uh the uh the welfare of the people whether uh can be successfully increased for whatever Expedition has has been made by the government or for whatever policy that have been decided by the government that is so overall what can I say the positive statement from derived from the positive analysis uh is talking about the opinion critical opinion but somehow we will look uh after this later it is not just uh General opinion it is not just only opinion without Soul so there is a technique for us to make sure that the the object the the opinion or the part normative statement that we are going to develop actually make sense or have some value okay this is what I mean so normative analysis is all about value of judgment about the economy how it's going to be and then what particular policy uh action are going to be and what we can recommend uh to the government in uh uh in order to achieve uh the objective I told you the objective that we uh What uh the objective that we are focusing now is how the government can use the tools that they have to increase the the welfare uh technically we can uh technically we can uh justify uh that that statement is talking is referring to the normative statement or Not by using a keyword like uh a statement to say a good bad just andjust fair unfair shoot somehow there are a lot of uh keywords that related to the what do we call it to uh to the statement of normative okay I'm giving you the example here uh the a simple State a simple normative statement okay example the price of milk the price of milk should be stabilized with uh ring Malaysia 6 a gallon minimum price level to give the daily farmer a Higher Living standard and to sa and preserve the agricultural uh Community if we look at this uh statement okay this is the output uh from uh normative analysis before this statement is made there there is a step or there is a an analysis that need to be done but the analysis is not involve a mathematical uh technique or some uh scientific technique like what we have uh what we have discussed what have uh what we have discussed in uh in the previous chapter when we were talking about uh tools for positive analysis it is more this uh the normative normative standard is just about um about the an analysis on when we come when we are doing a critical review so when we are doing a critical review here then after we conclude from the critical video but again I want I would like I would like to repeat it here a critical R here is not about the observation studies it is just a critical value that uh we can uh we need to think further without uh making without trying to find find any evidence this is what it mean okay when that's why I told that's why I tell if you refer to the first example this is not a simple example example of normative statement meaning to say that there is an analysis has been done before we are developing uh this kind of uh statement the second one uh the education budget should increase the same rate as GDP the education budget should increase at the same rate as GDP same go to this statement it seems like it's very simple and straightforward but there's a step there is an action have been made before develop we develop uh this statement this is what I mean there is a normative analysis that has been done then we come up with this kind of the statement okay now before we go forward uh in this uh session I've already explained you about what does it mean by normative statement but somehow in this topic actually things that we want to give more focus is not about how to develop uh the normative statement but we in this chapter actually we are looking more on how to come come up with a normative analysis so a normative analysis here as I told you it is not involved with any mathematical technique any uh scientific technique in order for us to come up with evidence it is just a uh our opinion our critical review then we develop a normative statement when uh when we talk about the opinion when we talk about the critic uh the critical value then there is a technique but not really scientific technique it is more to how to make our statement here have S have meaning and realistic so here straightforward for normative analy is not as complicated as the positive uh analysis if the normative analysis is just uh to use a correct uh suitable Theory so what theory that we need to use then that is the question we need to answer then we we will discuss about uh the theory uh a baseline theory that we can use uh in uh doing the normative analysis statement okay let us have uh a break for a while then we will continue uh to discuss about to select the theory what theory that normally we we use when we are doing a normative analysis uh in a scope of uh Public Finance