The Impact of Narrative Persuasion

How do narratives shape economic decision-making? In our interview, WZB researcher Kai Barron discusses how narratives influence interpretations of objective information. Barron delves into the complexities of belief formation and the profound impact one narrative can have on another's perspective. He explains how everyday language can provide valuable insights for behavioral economists and highlights an experiment showcasing the power of storytelling in financial contexts.

Narratives play a critical role in shaping economic decisions. Kai Barron's and Tilman Fries' (LMU Munich) research explores the intricate ways in which individuals interpret information and how one person's narrative can significantly sway another’s perspective. During his INSIGHTS interview with WZB media officer Lena Gatscha, Barron reveals the complexities of belief formation and mental models that underpin economic behavior.

Kai Barron also draws from the wisdom found in everyday language, reinforcing the idea that behavioral economists can gain valuable insights from other social sciences. He highlights an experiment Barron and Fries conducted involving financial advisors and investors, demonstrating that narratives can profoundly impact how individuals perceive and interpret data about a fictitious company, showcasing their vulnerability to persuasive storytelling.

5/2/2025, LG