Narrative Economics

In the popular 1984 fantasy romantic comedy "Splash," starring Tom Hanks and Daryl Hannah, one of the characters is a mermaid who is trying to live in New York City. When pressed for an English name, she chooses Madison because she is standing on Madison Avenue (named for U.S. President James Madison) and can see the street sign. One year after the movie came out, Madison began rocketing up the charts of U.S. baby girl names, until it peaked as one of the most popular in the 2000s. What explanation plausibly describes this situation?

1. Before seeing this movie, parents had not considered Madison as good name for a baby girl 2. The movie served as a vehicle to make the narrative that Madison is a good name very contagious 3. Once there were lots of baby girls named Madison, parents started to look elsewhere for names (For fun, you can check this by looking at baby name popularity on the US Social Security Administration website, where names are grouped by decade: http://www.ssa.gov/oact/babynames/decades/in Click on a few decades to see Madison rise and peak.)

What is the status of narrative economics within the economics profession? Select all that apply.

1. It is not well understood and mostly ignored 2. A small number of people are starting to pay attention to methods previously left to other social sciences

In this module, we often compared narratives spreading to disease epidemics, but we have not discussed how narratives get started. Below is reprinted a quotation from Walter Stahr's biography of Salmon P. Chase, one of the preeminent defenders of fugitive slaves in court in the nineteenth century, a founder of the Republican Party, Lincoln's first Treasury Secretary, and later Chief Justice of the U.S. Supreme Court. "On the day after Chase's death, the New York Tribune observed that to Chase, 'more than any other one man, belongs the credit of making the antislavery feeling what it had never been before: a power in politics. It had been the sentiment of philanthropists; he made it the inspiration of a great political party.'" Supposing that the spread of antislavery sentiment in the U.S. was a narrative epidemic, what can we learn from this?

1. Multiple historical figures can contribute to the spread of a narrative 2. Starting narratives can require alot of hard work and may take time 3. Individuals who help spread narratives need not be remembered as much as the narrative itself

Watch the following trailer for a video series by historian Niall Ferguson. https://www.youtube.com/watch?v=qWkM6QxSC0A This series looks at some examples covered in his 2018 book "The Square and the Tower." In this trailer he sets up a comparison between the invention of the printing press and the invention of social media websites. What choices describe the relationship between them? Select all that apply.

1. They both allowed narratives to be widely disseminated faster 2. Individuals could use them to circumvent traditional hierarchies of authority

Why does the Kermack-McKendrick SIR model tend to produce hump-shaped (bell-shaped) patterns through time for the number infected in epidemics

At the start of the epidemic the infected people meet susceptible people frequently to spread the disease, but later, as the infected gradually recover and become immune, there is less contact with the susceptible.

Question 5 In this module, we saw Professor Shiller use Google's Ngrams to search for the occurrence of words and phrases in Google's database of books. Let's familiarize ourselves with this service and document some other narrative epidemics. Visit https://books.google.com/ngrams/. Search for the following terms using the default settings: Match the plot below to the following search term: "Baseball"

Baseball

What narrative about the stock market from the time of the Great Depression make people start to focus on it?

The stock market is a barometer of economic success

Based on the videos in this module, what is one concern economists might have about our current understanding of the macroeconomy and GDP fluctuations?

Most of the existing analysis is conducted only on recent data from the last 50 years, when developed economies have been historically calm

Why do real home prices vary more than real rents?

Economists do not have an agreed upon explanation for this

What condition must be met at the beginning of a narrative epidemic for it to take off?

The narrative spreads faster than people get over it

According to this module, what is most needed to better understand the economy?

Identification of the narratives that underlie its changes

What is the main lesson to takeaway from the video about LA Law and law school applications? https://youtu.be/e7R6ycC_s1g?si=B-Qvi9nFM4ANugRa

Important life and economic decisions can be influenced by contagious narratives "In L.A. Law, law is a character or, more precisely, legal issues are characters. L.A. Law takes the ideas behind legal issues, adds a cup of sugar, and gets roughly 14 million viewers to swallow its recipe every week. No legal institution can claim that kind of influence on the public's conception of law and lawyers." -Stephen Gillers Taking L.A. Law More Seriously

Question 4 In this module, we saw Professor Shiller use Google's Ngrams to search for the occurrence of words and phrases in Google's database of books. Let's familiarize ourselves with this service and document some other narrative epidemics. Visit https://books.google.com/ngrams/. Search for the following terms using the default settings: Match the plot below to the following search term: "Influenza"

Influenza

The idea of "animal spirits" driving individual economic decision making was first popularized by which economist(s)?

John Maynard Keynes

In this module, we saw Professor Shiller use Google's Ngrams to search for the occurrence of words and phrases in Google's database of books. Let's familiarize ourselves with this service and document some other narrative epidemics. Visit https://books.google.com/ngrams/. Search for the following terms using the default settings: Match the plots below to the following search term: "Religion"

Religion

In this module, we saw Professor Shiller use Google's Ngrams to search for the occurrence of words and phrases in Google's database of books. Let's familiarize ourselves with this service and document some other narrative epidemics. Visit https://books.google.com/ngrams/. Search for the following terms using the default settings: Match the plot below to the following search term: "Tariff"

Tariff