Description:
People typically do not acquire new information about the facts of the economy through consulting official statistics; they read or listen to media-type reports on the economy where the facts are packaged in a story. This paper tests with an experiment whether the explanatory style used in such stories affects individual decision making. In a 2x2 design, our subjects receive a news prime about the economy before they play a minimum effort game. The news contains either ‘good’ or ‘bad’ facts about the economy and these facts are either presented using an ‘optimistic’ or a ‘pessimistic’ explanatory style. We find that the prime of a news story only affects behaviour when the facts are bad and the character of this influence then comes from the explanatory style