You’d think that Saturday nights were not a prime time for economic thought but last weekend was different. Flicking through the channels I managed to land upon one of the true wonders of modern television: All-Star Mr and Mrs. This show is incredible – take a couple who are clearly not deserving of their ‘All-Star’ status, endless amount of small talk and clichés from every angle and you have ITV’s All Star Mr and Mrs! But in watching how the game is played I am quickly reminded of John Maynard Keynes – clearly a match made in heaven.
I am not talking about every aspect of Keynes’ work (that would be truly incredible) but rather one aspect of it. In his famous General Theory he provides an interesting metaphor for asset markets. He states that they are like newspaper competitions where a contestant has to choose the six prettiest faces from a hundred photographs with the prize going to the contestant whose choice most closely resembles that of the average choices. One can clearly see here that the decisions people make are not perfectly rational: they are not choosing the six they find most attractive but rather they are deciding based on perception and expectation of a general consensus.
All-Star Mr and Mrs asks one partner a multiple choice question and then asks the same question to the ‘other half’. If the answers match then they win, or something. But the similarities are important with one distinct difference: in a newspaper magazine they are many independent contestants while on the show the two people know each other. However the fact still remains that the answers given are based upon the expectation of the other rather than an honest answer.
The real question seems obvious: did Keynes’ thinking form the basis for economic discussion and intellectual opinion for decades to come or did he pre-empt the format of a ‘popular’ prime-time TV show?