Dr. Shiller’s presentation and Q&A section made this event my favorite Global Studies experience so far. Before coming to the event, I had no idea what narrative economics was, and I think I do have a good grasp of this idea now. I think the overall idea of narrative economics should go under the category of behavioral economics since both of them is the study of how an individual’s behavior can affect the overall market. I’m actually really surprised about the point Dr. Shiller pointed out that in economics seldom mentioned the term “narrative” in media articles because similar concepts were really frequently appeared while I was taking the microeconomics class. People are making a decision due to certain incentives, and the incentives can be rising prices of a product, government’s restriction upon certain industry, or something similar to what Dr. Shiller’s mentioned: discussion and media narrative upon a controversial issue. Unfortunately, after finished reading the introduction of the book, I still wasn’t able to figure the clear relationship between narrative and incentive that was inside my head. I think in order to have a clear idea of what I am thinking, I need to finish the book.
Another thing I really love about the book and the presentation of Dr. Shiller’s is that he likes to use data and graphs to support his argument. I think the data and graphs he presented were fascinating, and it is really intuitive and perceptual. As someone who’s deeply into the topics of math and statistics, I really want to buy and take a look at his book after this presentation. The parallel he draws between economic narratives and disease outbreaks was fantastic. I like the way he first explained mathematically about the belt curve and exponential growth, and then shift to the technical explanation in economics terms.
I found the example of Bitcoin is also a great example to emphasis his idea. I remember my parents were talking about the idea of Bitcoin when it was first invented in 2009. Before its price went crazy, there was much conversation about them. But in 2018 when its price was the highest, it was all over the news. I could remember people were talking about it all the time, and it was on media articles frequently as well. The circle of Bitcoin price development was exactly like what Dr. Shiller mentioned: The price of Bitcoin increase results in more attention from the public, and then some people decide to buy in Bitcoins because they thought it’s a lucrative way. Similar patterns are happening to other products in the rest of the world as the result of free trade and the free market.
I don’t think the moderator and Dr. Shiller are on the same page during the discussion stage. For some reason, the moderator always wanted to ask questions related to politics, and the topic of the night was supposed to be related to economics. That might explain the reason why I felt like Dr. Shiller was not answering the question directly related to the question. When the moderator kept asking about the recession and whether it is going to happen, I don’t think he was aware that economists believe that there will always be an economic recession after a period of time. So the idea of recession is definitely going to happen, but it’s just a matter of time.