Robert J Shiller’s 2015 book “Narrative Economics” explains how narratives can drive economic events in ways economists have disregarded for too long. While wrapped in an extended metaphor – you could even say narrative – of epidemiology, Shiller’s theory reminds me of a stock market, where narratives rise and fall but rarely disappear entirely. This opens up new approaches, which I outline at the bottom of this article.
The “battle of ideas” narrative
Before getting into Shiller’s theory, let’s consider the “battle of ideas” as a narrative. Shiller uses Google’s Ngram tool to estimate the strength of narratives through time. While it’s only a proxy (and Shiller takes care to enrich his research with an understanding of the changing meaning of phrases through time), I did the same for the phrases “battle of ideas”.
The idea has popped onto the radar at various times. It would be highly speculative to assign the peaks to specific events, but it does appear to have been growing over the past century-and-a-half before dropping since the financial crisis. Perhaps the battle of ideas is reaching a ceasefire.
The battle of ideas narrative suggests that:
- there is a rational, knowable truth about pretty much anything;
- if people with different ideas have an argument in front of a bunch of educated people, the truth will kill off the falsehood.
It assumes that there is a winner and a loser. Like in a Western film, there is only space for one idea in this town.
Interestingly, this idea has found its way into AI research: Google Brain developed the General Adversarial Network, which pits computers against each other to find the best solution to a problem.
The “co-existing narratives” narrative
This more recent idea of co-existing narratives, though, has taken off since the early 80s according to a cursory Ngram search for “narratives”. It’s a fundamental break from Enlightenment thinking and much more relativistic in that it takes a more detached approach. The objective isn’t to find out what is rational or true, but to second guess what people are thinking (whether it’s true or not) and, crucially, how they are going to behave. Shiller cites nudge economics as a related concept, and the fact the whole thing is delivered within a narrative about illness (epidemiology) makes it no surprise he appeals to policy makers to stave off adverse events by keeping a close eye on which narratives are performing when.
Shiller gives the example of Roosevelt’s appeal to Americans not to withdraw all their savings when banks reopened during the Great Depression. There was a dangerous prevailing narrative that the banks were about to fail because everyone was going to withdraw all their money, which was bound to become a self-fulfilling prophecy. By appealing to responsibility and patriotism, Roosevelt established a competing narrative that ultimately turned the tide.
The framing is crucial: within the “battle of ideas” narrative, Roosevelt should have appealed with facts and let the public make their mind up. But economists and others no longer believe that facts alone can sway the public towards rational decisions.
Five lessons we can learn
For those of us who aren’t economists or heads of state, I think we can use Shiller’s framework to open up options for dealing with problems that don’t fit with the “battle of ideas” world view.
1. Start by observing
In a complex world that we don’t really understand, the idea of co-existing narratives allows us to stand back and just observe what’s going on without getting involved too much – at least to begin with. We’re not looking to understand objectively knowlable laws of nature and we don’t have to be wrong or right.
2. The power of narratives
Although they are socially constructed, we shouldn’t forget how powerful narratives are. No sooner have we realised certain facts aren’t laws of nature – there’s nothing inherently valuable about gold – we also realise that they can be equally powerful, or even more so, in determining how people behave. Would you pick up a bar of gold if you saw it lying on the street? Exactly.
3. Bide your time
One of the core parts of Shiller’s theories is that powerful ideas can subside over time and reappear later. Fears surrounding machines replacing all human labour are just one example of a narrative that keeps reappearing at intervals. So it’s worth biding your time, or tapping into relevant narratives at different times. (And the ones you don’t like may well pass!) In the “battle of ideas” worldview, a dead idea isn’t pining; it’s just dead. (Excuse the Monty Python reference.)
4. Reframe your work not as a fight but as a stockmarket
For people looking to support political causes or drive change within organisations, Shiller’s approach enables you to reframe your work not as a battle with your opponents to destroy ideas that stand in your way, but as a stockmarket where you invest in narratives that feed into your interests. You can concentrate on nurturing your narrative, not fighting others, and think for the long-term. Our time will come!
5. Facts have a role
Facts can help, but you might be better off using them to strengthen your own narrative rather than fighting others. Even though you might be thinking in terms of narratives, the “battle of ideas” narrative is so strong that you probably can’t get away without being seen to be rational and fact-driven. People need facts to anchor them so they don’t feel they’re in a made-up fantasy world. However, it’s difficult to persuade people to give up their own strong beliefs by presenting your facts to them. An alternative narrative is harder work, but might stand a better chance.
Objections to the sheer cynicism of it all
I’m fascinated by the idea that it’s possible to observe narratives and better understand how people will behave in the future, but it can strike you as rather cynical if you don’t commit to a particular narrative but ride waves as they come and go.
It doesn’t have to be like that! Shiller’s Roosevelt example (above) saw the US president offer an alternative narrative, but it didn’t work by dividing people. In fact, the opposite was true: it could only succeed by uniting a large number of people around it.
So there’s a distinction to be made between the “filter bubble” approach, whereby different groups have different narratives, and the camp-fire approach where there are alternative narratives for varied groups of people to unite around.