Narrative economics is about how stories and perceptions are spread between people and how these can change perceptions of events and economic decisions. Just think of recessions, bubbles and so on. Such stories can go viral and reinforce beliefs such as that individual shares and house prices can only go up. Regardless of whether such beliefs are right or wrong, they will be able to influence how people and companies make financial decisions. Traditionally, the subject of economics has placed little emphasis on explaining and understanding this phenomenon, but, as the video below shows, understanding narrative economics can contribute to a greater understanding of economic events that lead to recession, inequality and so on.
Dollar Street: How to live for 10 dollar a day?
Imagine that the whole world lived in the same street and where people lived was sorted by income. The poorest on the left and the richest on the right. All the others somewhere in between. Welcome to Dollar Street.
The website Dollar Street is created by the organization Gapminder. The idea is to show what standard of living people around the world have, the dependence on family income, and how this affects how they live, what they eat and what material goods they have such as toys, toothbrushes, furniture etc. The website gives a wonderful insight into what do we mean by having different living standards.