Book Review: Narrative Economics

Next up is Narrative Economics by Robert J. Shiller.

Back when Bitcoin was trading around $500 I remember having a conversation with a guy in Washington DC at a dinner, and as I am known to do, I brought up the topic of Bitcoin.  We had an interesting discussion about how the future value must already be priced in.  Of course, I disagreed because I knew one thing he didn't, and that is I knew about the meme of the halving.

I am not quite sure why no one in the Bitcoin space is discussing this book.  The main introduction to Narrative Economics is about the Bitcoin narrative and how it has grown over time by infecting our thoughts, just like a virus would infect our bodies.  Could this book be any more timely?

Just like Ebola turns into an epidemic by spreading through person to person contact, narratives and thoughts that shape economic behavior travel through voice and video.  Just like a virus can spread and come and go in waves, the memes we believe in can hide latent in the population and rear up at any given time.  Just like the flu mutates every year and comes back in different forms, narratives can change with the times and become even more potent.

The new technology we have that can track word mentions in books and search interest to track how pervasive certain narratives are.  We can see new phrases come into the popular blogosphere and become a rallying cry.  And since this technology is so new, old fogey economists probably aren't paying enough attention to how these narratives impact our economic decision making.  

You can find the book at Amazon.