Differences in Scientific Judgments

Several centuries ago, astronomers debated whether the earth or the sun was at the center of the solar system. More recently, meteorologists have debated whether the earth is experiencing global warming and. If so why. Science is a search for understanding about the world around us. It is not 

surprising that as the search continues, scientists can disagree about the direction in which truth lies.

Economists often disagree for the same reason. Economics is a young science, and there is still much to be learned. Economists  sometimes disagree because they have different hunches about the validity of alternative theories or about the  size of important parameters that measure how economic variables are related.

For example, economists disagree about whether the government should tax  a household’s income or its consumption (spending). Advocates of a switch from the current income tax to a consumption tax believe that the change would encourage households to save more because income that is saved would not be taxed. Higher saving, in turn, would lead to more rapid growth in productivity and living standards. Advocates of the current income tax system belive that household saving would not respond much to a change in the tax laws. These two groups of economists hold different normative views about the tax system because they have different positive views about the responsiveness of saving to tax incentives.