What helps economists reliably analyze and predict behavior

Normative statements express opinions or values about what ought to be and cannot be tested or validated through empirical evidence. While they may influence economic policy, they do not provide a reliable framework for analysis or prediction, which is central to the discipline of economics.

Similar to normative statements, normative judgments are subjective assessments about economic issues that reflect personal beliefs rather than objective analysis. These judgments can guide decision-making but lack the empirical basis necessary for reliable predictions. Thus, they do not serve as tools for analyzing economic behavior.

Economic bubbles refer to market phenomena where asset prices significantly exceed their intrinsic value, often leading to dramatic collapses. While understanding bubbles is important for economic analysis, they are specific occurrences rather than systematic tools for prediction. Bubbles may illustrate certain behavioral patterns but do not constitute a reliable method for broader economic analysis.