More risk-averse and less entrepreneurial people grew up listening to stories wherein competitions and challenges are more likely to be harmful than beneficial

See Folklore by Stelios Michalopoulos & Melanie Meng Xue. From The Quarterly Journal of Economics, Volume 136, Issue 4, November 2021. Excerpts:

"Abstract

Folklore is the collection of traditional beliefs, customs, and stories of a community passed through the generations by word of mouth. We introduce to economics a unique catalog of oral traditions spanning approximately 1,000 societies. After validating the catalog’s content by showing that the groups’ motifs reflect known geographic and social attributes, we present two sets of applications. First, we illustrate how to fill in the gaps and expand upon a group’s ethnographic record, focusing on political complexity, high gods, and trade. Second, we discuss how machine learning and human classification methods can help shed light on cultural traits, using gender roles, attitudes toward risk, and trust as examples. Societies with tales portraying men as dominant and women as submissive tend to relegate their women to subordinate positions in their communities, both historically and today. More risk-averse and less entrepreneurial people grew up listening to stories wherein competitions and challenges are more likely to be harmful than beneficial. Communities with low tolerance toward antisocial behavior, captured by the prevalence of tricksters being punished, are more trusting and prosperous today. These patterns hold across groups, countries, and second-generation immigrants. Overall, the results highlight the significance of folklore in cultural economics, calling for additional applications."

"Two broad observations motivate our study. First, narratives are central building blocks of our societies. We think in stories and explain the world by telling stories. Harari (2015), for example, identifies in the myths present in people’s collective imagination the roots of their successes and failures. Despite their central role in connecting actions to values and needs, economists have only recently turned to the study of narratives (e.g., Akerlof and Snower 2016; Shiller 2017).¹

Second, during the past two decades, a burgeoning body of work exploring the cultural, historical, and institutional roots of comparative development highlights the significance of ethnic, linguistic, and religious groups (Michalopoulos and Papaioannou 2017; Nunn 2020). Much of this research, however, relies on valuable but incomplete ethnographic sources including the widely used Ethnographic Atlas (EA). Furthermore, the absence of proxies of historical norms renders inquiries into how attitudes change and why they persist intractable.² Other weaknesses of the EA, the celebrated compilation of George Peter Murdock (1967), concern the uneven coverage of groups and attributes and measurement error."

"In this study, we leverage a group’s oral tradition to shed light on its cultural heritage and past social and economic structures. According to the Oxford Dictionary, folklore consists of the traditional beliefs, customs, and stories of a community, passed through the generations by word of mouth. This corpus is the subject of the discipline of folklore. We do three things to reveal the potential of integrating traditional narratives in the toolset of economists and political scientists interested in the origins of comparative development, gender norms, morality, psychology, and culture.

First, we introduce to economics a catalog of folklore that codes the distribution of thousands of motifs across 958 world societies. This database is the lifetime work of eminent anthropologist and folklorist Yuri Berezkin. A motif, according to the author, is an episode or an image found in the set of narratives recorded in an ethnolinguistic community. We validate the catalog’s content by establishing that images and episodes in a group’s oral tradition reflect salient features of its physical environment. For example, groups closer to earthquake-prone regions have a higher incidence of earthquake-related motifs, groups on fertile land have more crop-related images, and groups living close to rivers (or in colder climates) have more episodes reflecting their respective landscapes. Then we link the groups in Berezkin’s collection to the EA and show that the folklore-based measures of political complexity, family structure, and subsistence mode robustly correspond to EA’s analogous traits.

Second, we illustrate how to use a group’s oral tradition to fill in gaps in the ethnographic record, focusing on the degree of political complexity and the presence of high gods. In addition, we show how one can use folklore to quantify the extent of the preindustrial market economy, a key economic aspect that the EA does not cover.

Third, we present a method to uncover a group’s cultural heritage that involves reading and classifying motifs by multiple individuals.³ We focus on trust, risk-taking, and gender norms to illustrate our approach. To capture trust, we look at how tricksters (a common archetype in oral traditions) are depicted in the motifs, distinguishing between cases where their deceiving behavior is successful or punished. Regarding risk-taking, we look at how challenges and competitions are portrayed, differentiating between tragedies and victories. To measure gender norms, we classify the various stereotypical roles males and females play in the motifs.

These folklore-based measures of historical attitudes are robust predictors of contemporary values and economic choices. Folks who grew up listening to stories where tricksters often fail to deceive their victims are more trusting and prosperous today. Groups with oral traditions rich with heroes who successfully tackle challenging situations tend to display more appetite for risk and appear more entrepreneurial. Societies whose folklore portrays women as less dominant, more submissive, and more likely to engage in domestic affairs than men tend to relegate their women to inferior roles in their communities, both historically and today. These patterns hold across countries, second-generation immigrants, and ethnic groups, suggesting that folklore may be one of the vehicles by which norms are intergenerationally transmitted."

The symbolic work of prices

By Akash Miharia, Jan Osborn & Bart J. Wilson. In The Review of Austrian Economics.

Abstract:

"We posit that prices are signs, not just signals, that work in the same symbolic way as words. Both are complex, generative systems of shared meaning that rely on a web of intricate symbolic references. Just like the meaning of a word is a product of our social and linguistic action, the meaning of a price is a product of our relationship to the physical world phenomena of people in markets. The fundamental conception of both is to communicate and construct worlds with ourselves and others, enabling us to act in the world. Prices, like words, do symbolic work."

Personal narratives build trust across ideological divides

By David Hagmann, Julia A. Minson & Catherine H. Tinsley.

"Abstract

Lack of trust is a key barrier to collaboration in organizations and is exacerbated in contexts when employees subscribe to different ideological beliefs. Across five preregistered experiments, we find that people judge ideological opponents as more trustworthy when opposing opinions are expressed through a self-revealing personal narrative than through either data or stories about third parties—even when the content of the messages is carefully controlled to be consistent. Trust does not suffer when explanations grounded in self-revealing personal narratives are augmented with data, suggesting that our results are not driven by quantitative aversion. Perceptions of trustworthiness are mediated by the speaker’s apparent vulnerability and are greater when the self-revelation is of a more sensitive nature. Consequently, people are more willing to collaborate with ideological opponents who support their views by embedding data in a self-revealing personal narrative, rather than relying on data-only explanations. We discuss the implications of these results for future research on trust as well as for organizational practice."

Maybe personal narratives are emotional and emotions are costly to fake. So the message is more believable. This reminds me of one of my papers, The Intersection of Economic Signals and Mythic Symbols.

"Abstract 

Mythic symbols and economic signals represent more than what they are. Symbols represent universal ideas and themes and evoke feelings and emotions while economic signals are simple, efficient signs that stand for a more complex set of costly to learn characteristics and information. Symbols deal with the irrational and economic signals deal with the rational. Many of the signals cited in the economic literature work well because they have a symbolic element that speaks to people's emotions. By evoking emotions, a signal makes the receiver feel more confident about the truthfulness of the information it represents. The intersection of symbols and signals illustrates the relationship between the rational world of facts and irrational world of emotions and values, a relationship which needs to be explored as part of the development of the ideal type of homosocioeconomicus, the selfish yet value and community driven person."

Harvard Business School Prof Says Rituals Are Important

See ‘The Ritual Effect’ Review: Well Worth Doing Again: Some rituals are inherited, others improvised. It’s possible to infuse even quotidian acts with a sense of consequence by Meghan Cox Gurdon.

She is a WSJ contributor and author of The Enchanted Hour: The Miraculous Power of Reading Aloud in the Age of Distraction.

She reviews the book The Ritual Effect: From Habit to Ritual, Harness the Surprising Power of Everyday Actions by Harvard Business School professor Michael Norton. Excerpts:

"In “The Ritual Effect,” Michael Norton lauds the capacity of ritual to infuse quotidian acts with a sense of consequence. Ritual, he writes, can transform “activities as ordinary as morning hygiene, household chores, or daily exercise from automated to animated experiences—conjuring up delight or wonder or peace.”

Mr. Norton is a professor at Harvard Business School and a student of behavioral economics, and what he calls a ritual could as easily be described as a custom, a practice, a routine or a bit of magical thinking. What a ritual is not, he emphasizes, is a habit. In his view, a habit pertains to the “what” we do, whereas a ritual speaks to the “how.” It is a distinction without much difference. Say a husband makes a frothy latte for his wife each morning: Some days he might do it by rote (making it a habit) while on others he might take extra care to perform the act with love (making it a ritual)."

"Human beings seem given to ritualized behavior. Some rituals come to us as legacies, as with the white dress of a bride; some arise from practical impulse, as with spring cleaning to rid a house of winter grit; some are improvisational, as with a family movie night that starts as an occasional treat and becomes a weekly fixture on the calendar."

"actionable protocols, which is to say, recommendations for ways we readers may add the emollient of ritual to our own lives." 

"“No single ritual can elevate us into relationship nirvana,” Mr. Norton warns but adds that, in surveys, couples who enjoy rituals report being 5%-10% “more satisfied with their relationships.”"

"We read of “hedonic adaptation,” which is what happens when a person’s happiness stabilizes after an ecstatic experience; of the “collective effervescence” felt by people performing synchronized actions; of the Proust-like “positive mental time travel” that one performs when savoring an enjoyable experience while recalling other such instances."

"“The Ritual Effect” is also full of stories from the lab, where Mr. Norton and his colleagues test their ideas on invited audiences. It turns out that ritualized behavior has a dark side. Flouted, it may foment bitterness. As with social norms—those generally agreed-upon practices and attitudes that allow disparate persons to rub along in society without continual conflict—shared rituals require practitioners roughly to agree about what is happening and what is expected of them. Let one in the group refuse to go along, and we get what’s called “the black sheep effect,” which is the instinct to punish an uncooperative insider more harshly than one would an outsider. In the clinical setting, Mr. Norton says that there’s always one smarty-pants who refuses to join a communal activity. “The people in the audience reserve a special kind of derision for these opt-outers,” he writes. “Because, with ritual, there are no bystanders. You’re either doing it right and you’re one of us—or you’re wrong.”"

"When an old ritual no longer fits, whether at home or at work, Mr. Norton suggests we are wise to find new ones: “In our (re) marriages, in our (blended) families, in our mergers and acquisitions, in nations yearning to find peace, rituals of reconciliation help to turn the page and start a new chapter.”" 

Here is an excerpt from Wikipedia about  "collective effervescence."

"Collective effervescence (CE) is a sociological concept coined by Émile Durkheim. According to Durkheim, a community or society may at times come together and simultaneously communicate the same thought and participate in the same action. Such an event then causes collective effervescence which excites individuals and serves to unify the group.

Collective effervescence is the basis for Émile Durkheim's theory of religion as laid out in his 1912 volume Elementary Forms of Religious Life. Durkheim argues that the universal religious dichotomy of profane and sacred results from the lives of these tribe members: most of their life is spent performing menial tasks such as hunting and gathering. These tasks are profane. The rare occasions on which the entire tribe gathers together become sacred, and the high energy level associated with these events gets directed onto physical objects or people which also become sacred."

New book: The Divine Economy: How Religions Compete for Wealth, Power, and People

It is by Paul Seabright. Click here to go to the Amazon link.

"A novel economic interpretation of how religions have become so powerful in the modern world

Religion in the twenty-first century is alive and well across the world, despite its apparent decline in North America and parts of Europe. Vigorous competition between and within religious movements has led to their accumulating great power and wealth. Religions in many traditions have honed their competitive strategies over thousands of years. Today, they are big business; like businesses, they must recruit, raise funds, disburse budgets, manage facilities, organize transportation, motivate employees, and get their message out. In The Divine Economy, economist Paul Seabright argues that religious movements are a special kind of business: they are platforms, bringing together communities of members who seek many different things from one another—spiritual fulfilment, friendship and marriage networks, even business opportunities. Their function as platforms, he contends, is what has allowed religions to consolidate and wield power.

This power can be used for good, especially when religious movements provide their members with insurance against the shocks of modern life, and a sense of worth in their communities. It can also be used for harm: political leaders often instrumentalize religious movements for authoritarian ends, and religious leaders can exploit the trust of members to inflict sexual, emotional, financial or physical abuse, or to provoke violence against outsiders. Writing in a nonpartisan spirit, Seabright uses insights from economics to show how religion and secular society can work together in a world where some people feel no need for religion, but many continue to respond with enthusiasm to its call."

The hidden forces of memory lead to the formation of identity and the creation of our own life narrative

See ‘Why We Remember’ Review: Finding Time Again and Again by Brandy Schillace. She reviews the book Why We Remember: Unlocking Memory's Power to Hold on to What Matters by Charan Ranganath. 

Ms. Schillace, the editor in chief of the journal Medical Humanities, is the host of the online “Peculiar Book Club” and the author of “Mr. Humble and Dr. Butcher.”

Excerpt:

"Memories are “born in the moment of reconstruction,” often with plenty of veracity—but never as photographic copies. They can be influenced by emotion—the stronger the emotion, the more readily our brains will hold on to that memory—and are often the root of hidden biases. A decision we make today may have been influenced by a strong emotional memory; as a result, emotional memories become hidden forces that deeply and often invisibly impact how we view the world, even what jobs, paths or partners we choose. Psychological intervention often requires us to revise our memories and put them into a new, less emotional context [this reminds me of Jung saying we need to ask, “What myth am I living by?”]. The war veteran must learn to hear loud noises without the fear-laden memory response to bombs falling; the child once attacked by a dog must learn to encounter four-legged animals without trepidation. Yet the hidden forces of memory, good and bad, also lead to something more germane: the formation of identity and the creation of our own “life narrative.”

This sense of self sits upon shifting sand, but we should want it no other way. The most significant lesson of “Why We Remember” is that we need not be prisoners to our incompletely remembered past. The very malleability of memory means we can take an active role in what and how we recall, and use it to shape our future." 

Also see What Myth are You Living By? by Diane Hancox.

And Revisioning Your Hero's Journey®: A Mythological Toolbox by Robert Walter.

Parents pay big $s for consultants to improve their kid's stories for college admissions

See Inventing the Perfect College Applicant: For $120,000 a year, Christopher Rim promises to turn any student into Ivy bait by Caitlin Moscatello. This is a fascinating article, even beyond the issue I focus on. Excerpts:

"For the past nine years, Rim, 28, has been working as an “independent education consultant,” helping the one percent navigate the increasingly competitive college-admissions process — the current round of which ends in February. He started by editing college essays from his Yale dorm room for $50 an hour but now charges the parents of his company’s 190 clients — mostly private-school kids, many of them in New York — $120,000 a year to help them create a narrative he believes will appeal to college-admissions officers. That company, Command Education, currently has 41 full-time staffers, most of whom are recent graduates of top-tier colleges and universities. The pitch is crafted to appeal to the wealthy clients Rim courts: a “personalized, white glove” service, through which Command employees do everything from curating students’ extracurriculars to helping them land summer internships, craft essays, and manage their course loads with the single goal of getting them in."

"The theme of the passion project becomes what Cramer calls the “hook” that hangs their essays and lists of extracurriculars together. “You don’t have to play the violin, be the first chair in your state, and rescue the whales. You can just pick one and be so good at it that you want to dare the admissions officers not to accept you and that they will regret it,” says Rim. No matter what, “we will find the story.”"