‘How can you stand there and say you didn't overspend and end up bankrupting this country’?: Power, propaganda and public understanding of the economy

Authored by: Mike Berry

The Routledge Companion to Political Journalism

Print publication date:  October  2021
Online publication date:  October  2021

Print ISBN: 9780367248222
eBook ISBN: 9780429284571
Adobe ISBN:

10.4324/9780429284571-20

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Abstract

This chapter reviews the literature on public knowledge and understanding of the economy. It analyses both the findings from the ‘top-down’ literature which examines how much people know about key economic indicators, and ‘bottom-up’ studies which explore lay theories of the economy. The review finds that economic knowledge and understanding is heavily stratified by class, education, gender and age. Most of the public conceptualize the economy through metaphors – predominately ‘the economy as household analogy’ – which provide ‘powerful but thin’ ways of thinking. Economic phenomena tend to be seen in isolation and there is very limited understanding of indirect effects. With regard to the key political battleground of public spending there is widespread confusion particularly in relation to the contours of welfare spending. Using the example of the Great Financial Crisis the chapter then analyses how public misperceptions about the economy helped facilitate the acceptance of austerity policies widely seen as damaging by most economists (Chu, 2015). The chapter concludes by offering suggestion for how reporting in this area could be improved so as to raise audience comprehension and protect the public from economic misinformation.

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