Dan Erwin

Nobelist Robert Shiller’s New Approach to Economics: The “Economic Narrative.”

My graduate research early in the 1980s was focused on narratives. By that time education had begun to realize that teaching just facts or principles without embedding them in stories was a poor way of teaching. The primary reason for that wasn’t fully understood until neuroscience got in the business of figuring out how memory and understanding work. The result of a lot of research was that memory is based on stories that we put into our gray matter, not on principles or facts. Sounds dumbly obvious today, but it wasn’t obvious until fairly recent.

I studied narrative and brief stories from the standpoint of their actual form and then the underlying values that caused people to buy into the story. What made most sense to me was that stories primarily take the form of tragedy, comedy or fairy tale. Tragedy and comedy are two very different ways of attacking human experience. And fairy tale is something else!

Tragedy is about destiny and fate. I just finished watching the four seasons of The Bureau, a French series on espionage. The final ending was a tragedy, where the leading character experienced the fate of death (Don’t let that keep you from watching the series. It’s just fascinating.) I responded as an American and didn’t like that ending, even though it made perfect sense. The French and especially the Greeks love tragedy. The Greeks always look first for tragedy and I suspect that’s part of the reason their economy is in the shitter. We Americans much prefer comedy—not “funny ha-ha,” but someone succeeding as a result of their wit, wisdom and strength, like all the John Wayne stories of the past (that really dates me!) But Americans really, really love fairy tale—someone coming to the rescue, like the cavalry rescuing the settlers from the Indians (that’s not politically correct, but we still like these stories in different contexts. Today, they often take the shape of mysteries with an especially sharp detective, who’s often a female!) Social psych has found that American optimism—related, I’m sure to our beliefs in priorities of comedy and fairy tale are part of the rationale for our national success.

So, what does narrative have to do with business and economics?
I learned just a few years into business consulting that the stories people told revealed as much about their firm as direct questioning...

Why a Kid’s Rudeness and Bad Behavior Might Be a Good Thing

It must have been fifteen years ago, but I still remember the incident. My wife and I were at a church picnic with a lot of families and several of our church’s pastors. After a meal, we were a bit involved in an ongoing conversation with adults. But we couldn’t help notice that one pastor’s daughter of ten or twelve years was waiting on her mom and dad while her younger sister and the rest of the kids were roughhousing and making a lot of noise. We had noticed that the younger sister was ignoring her older’s requests for help. And when pushed a couple times, she had rather pointedly said she was playing with her friends--and took off. But contrarily, several adults had commented that it was “so nice” that the pastor’s daughter was helping at the picnic.

After the third or fourth person commented how nice that the older daughter was helping, I looked at my wife and she rolled her eyes and got a similar response from me. Since it was a fairly large group of adults I stood up and my wife immediately joined me for a brief walk out in the forest. “Well, I suspected that. . .” and before I finished my wife responded, “yes, it was obvious.” “Gutsy younger daughter,” I added, to my wife’s laughter and agreement.

We didn’t have to say anything else because we both recognized that the pastor had some fairly narcissistic behaviors that were negatively impacting his older daughter--and that she was being ignored by her younger sister. In other words, it wasn’t “so nice” that one daughter was taking care of her parents. At her age she should have been free to explore, play with her friends  and get dirty,  instead of wearing a nice dress—and being unconsciously controlled by her parents.

And the “rudeness” of the younger daughter? Probably good stuff. I suspect that goes against the grain of a lot of parenting. But there are a couple very important pluses in “bad behavior.”

Actually, Alligators Are Great

That's the last word from Douthat's Sunday NYTimes opinion--and that's the argument, Douthat says, that the Republicans will be making.

When Trump Gets His Alligator

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In the Ukraine scandal, the guardrails protecting the president from his worst impulses broke down. Makes complete sense.

Photo from The Economist

And of course he wants alligators and poisonous snakes on the Rio Grande border. The Economist totted up the cost of his schemes. The total, including water pumps, electrified flesh piercing spikes--and shooting migrants in the legs--would add up to approximately $30 bn...