Welcome to Econ Talk, part of the Library of Economics and Liberty.

I'm your host, Russ Roberts of Stanford University's Hoover Institution.

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Today is December 6, 2019, and my guest is author economist and Nobel laureate Robert Schiller of Yale University,

where he is the sterling professor of economics. He appeared on e-con talk in September of 2008.

To talk about housing and bubbles, his latest book and the subject of today's conversation

is Narrative Economics Bob Welcome Back to E-con Talk.

My pleasure. What do you mean by Narrative Economics?

For me, Narrative Economics is the study of popular narratives that relate to economic behavior.

People change their thinking about economic issues through time, and this causes events, economic events, I believe.

And the form that their change of thinking takes is stories.

They don't write down equations or draw diagrams. They tell stories, narratives, stories with a bit of morals to them, or lessons in them.

And then if those stories go viral, we see economic changes.

So the idea is to study them, to catalog narratives, to group them, look at their history, we have they occurred before, how have they changed? That's the idea.

And along the way you talk about a little bit about the neuroscience of this idea, and it certainly we as human beings like stories were attracted to stories, were more likely to remember stories.

That's right. And this has always been true. A book I can recommend is the Roman Senator, Cicero's book written 2000 years ago on rhetoric.

I'm sorry, it's on oratory. And he tells you how to make your speeches into a story.

And I think that good speakers have learned how to stimulate audiences so that they'll talk about it and remember it.

That's going viral. You could go viral in ancient Rome. They did. Cicero did. We still remember him.

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