Some economists conduct empirical research on the theory of the firm by measuring the degree of technical efficiency achieved by actual firms. What type of research contributions are provided by these studies?
A) Normative
B) Positive
C) Administrative
D) Executive

Question

Quizplus · Accepted Answer

Empirical research on the theory of the firm that measures technical efficiency of actual firms provides positive research contributions. Positive research seeks to explain phenomena and test hypotheses, often using empirical data. In this case, the researchers are using empirical data (measurements of technical efficiency) to test the theory of the firm. This is in contrast to normative research, which makes value judgments about what ought to be done, administrative research, which studies the behavior of organizations and individuals within them, or executive research, which focuses on practical decision-making within a firm.

Some Economists Conduct Empirical Research on the Theory of the Firm