Summary of the Blinkist summary :
(my thoughts are in italic)
Narrative Economics considers the collective stories that change economic behaviour.
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The rise of Bitcoin illustrates the power of narrative in economics. If you were to approach most Bitcoin investors and ask them about the technology behind the crypto like “Merkle Tree” or the “Elliptical Curve Digital Signature”, it’s like you’d be met with blank stares. Instead, what excites most Bitcoin investors is the narrative around it. It’s the promise of the future.
Lol yay, you’re right. I know what Merkle Tree is but not Elliptical Curve Digital Signature. Do you need to understand how an engine works in order to drive a car?
Another popular idea attached to Bitcoin is the notion of a currency that’s outside the control of big banks and governments. This appeals to an anarchic streak in its investors, who believe that these institutions have become corrupt and inefficient.
Bitcoin disperses power away from a central authority.
The study of epidemics can tell us a lot about economic narratives. Disease epidemics and narrative epidemics follow a similar shape. By studying the pattern of epidemics, we can get ahead of certain contagious stories and model our economic and political responses accordingly.
Interesting how Shiller uses disease epidemics as a framework to understand economics.
Narratives often occur in constellations with other narratives. When we seek to understand one popular narrative, we must always be careful not to miss the constellation of related ideas that surround it. Otherwise, we’ll only see a tiny part of a much bigger picture.
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Economic narratives often hinge on particular, vivid details.
I don’t get it.
There’re perennial economic narratives that occur again and again.
I feel like this chapter can be summarised in three words: History repeats itself.
The economic impact of narratives may change through time.
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