Narrative Economics: How Stories Go Viral and Drive Major Economic Events
Contagion. The novel coronavirus has gotten many of us to think about the concept of herd immunity. In his book titled, Narrative Economics: How Stories Go Viral and Drive Major Economic Events, Nobel Prize winning economist Robert J. Shiller offers an adjacent theory: that the spread of stories has a powerful role in economic behavior. I know a CEO who will often frame a decision-making conversation in terms of what one would have to believe for the outcome to be probable. The beliefs of the herd can spread, and like lemmings, we can follow others into economic behavior that builds momentum from beliefs that are not necessarily supported by data. Shiller’s writing for general audiences is always clear and cogent. Readers interested in business, finance and economics will find something to think about after reading this book.