I distrust people who chatter about their narrative for this thing or that, it's just a gussied up attempt at manipulation. However...the outro from our May 27 post "The Alienated ‘Knowledge Class’ Could Turn Violent" contained this:
Narratives vs. Reality
Be careful when dealing with Turchin. Although it appears that he correctly forecast the violence of 2020, it is difficult to unravel whether he's on to something, got lucky or, in superimposing a worldview onto the world, is driving square pegs into round holes, shaving the corners to make them fit his template.
That said, on the other hand I distrust anyone who leads with "narrative" as that is the tool of charlatans and other deceitful peeps. With a carve-out for Professor Shiller who uses the concept as an explanatory model for economic and market zeitgeist....
Here's some copy pasta of that hyperlink. From Yale University's Yale News, Nov 4, 2019:
Shiller, a Nobel Prize-winning economist and Sterling Professor of Economics, discusses how stories can influence booms, recessions, and other economic events.
Stories matter, shaping our beliefs, decisions, and actions. Nobel Prize-winning economist Robert J. Shiller sees this play out in the economy constantly.
Shiller, Sterling Professor of Economics at Yale, in recent years has urged his colleagues to consider how popular narratives — simple stories, true and untrue — influence booms, recessions, and other economic events. He has suggested expanding the field of economics to include the quantitative study of changing narratives, which he argues would improve economic forecasts and provide a clearer understanding of the complex forces driving economic change.
Shiller expands on this idea in his latest book, “Narrative Economics: How Stories Go Viral and Drive Major Economic Events.” He spoke with YaleNews about it.Interview condensed and edited.
What is narrative economics?
In 1894, the Palgrave Dictionary of Political Economy included the term “narrative economics,” but it was defined as an economist writing a narrative, which is a sequence of events in history. That’s not how I’m using the term.
For me, narrative economics means studying the popular narratives that underlie people’s thinking, not just economists’ thinking. We have to know why people spend more in a boom and less in a bust. Why do they pay attention to the stock market? Why do they perceive the stock market as a barometer that measures the health of the economy? Why do they place such value on home ownership? Those are all parts of economic narratives. I want to study the narratives through time and across space. These ideas color people’s thinking and actions.
One of the book’s key propositions is that economic events are substantially driven by contagious spread of oversimplified and easily transmitted variants of economic narratives. We need to incorporate the contagion of these narratives into economic theory. Otherwise, we’re overlooking a very important mechanism for economic change. We need to better understand the epidemics of popular narratives in order to fully understand fluctuations in the economy and in economic behavior.
Why haven’t economists traditionally considered popular narratives in developing theories and forecasts?
It’s difficult to quantify narratives because they are always changing and there are so many of them. We can’t go around listening in on people’s conversations to gauge a narrative’s effect. Digitized text and improved search engines allow us to search books, magazines, newspapers, business reports, legal briefs, personal diaries, sermons — all sorts of things — and get a sense of the popularity of specific terms. I did that while researching the book. At this point, the study of narratives involves computers and human judgment. You can’t just count the number of times a word is used. You have to look at how people are using the word. There are significant challenges to measuring narratives and incorporating them into economic theory, but I don’t think they are insurmountable.
One of the contemporary narratives you discuss involves the establishment of crypto-currency. What was the role of narrative in the rise of Bitcoin?
The crypto-currency narrative is intense. At its peak, Bitcoin reached a value of more than $326 billion. That’s big time. Why did it happen? Bitcoin was a dream in the eye of some computer scientist, and we don’t even know that person’s identity. It was supposedly an individual named Satoshi Nakamoto, but that has never been verified. We don’t even know if he exists. There’s an element of mystery to the narrative, which is important.
I think narrative is very important to the popularity of Bitcoin and other crypto-currency. Part of the reason that Bitcoin succeeded is that it fed into an anarchism narrative that government is unnecessary and untrustworthy. It fostered a narrative that young people have created a financial institution that is out of the government’s reach. That’s a powerful narrative. It strikes people as fun and exciting like any viral video does, although it isn’t a sign of the validity of Bitcoin’s core concepts.
The mystery component is also very powerful. People like mystery stories. And mystery stories generate their own news, such as when people come forward claiming to be Satoshi Nakamoto. The legend of Satoshi Nakamoto may live on for a long time....
....MUCH MORE
I am so turned off by messaging and narrative and all that that I ended the "Narratives vs. Reality" post with:
For some reason when I hear people pseudo-analyzing the collapse of this or that favorite movement, I end up picturing the head of the Reich Ministry for Public Enlightenment and Propaganda, Herr Goebbels, looking around at the ruins of Berlin and saying: "Maybe it was a failure of messaging."
Sarcasm is a lowly form of expression. But sometimes effective.