Crisis Perception in Financial Media Discourse : A concrete application through the Minskian /...

12th International Post Keynesian Conference UMKC, Sept 25-27, 2014

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Crisis Perception in Financial Media Discourse : A concrete application through the Minskian / Mainstream opposition

Marc Pilkington, Associate Professor, University of Burgundy (Dijon, France)&Christine Sinapi, Associate Professor, Burgundy School of Business (Dijon, France)

12th International Post Keynesian Conference,

Kansas City, Sept 25-27, 2014

Pilkington - Sinapi

12th International Post Keynesian Conference UMKC, Sept 25-27, 2014 2

Research Question & hypothesis

While Minsky conceptualizes the crisis as endogenous and inherent in the development of financial capitalism, the mainstream model (hereafter MM) posits the existence of a stable equilibrium: the crisis is always and everywhere a temporary deviation from equilibrium, merely caused by an external shock.

RQ : Does financial media discourse lean one way or the other? Are financial reports/analyses neutral in discursive terms?

Working hypothesis: the Minskian and mainstream approaches both turn underlying concepts into distinct discourses.

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The financial instability hypothesis vs. mainstream approaches of the crisis

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Financial Instability Hypothesis Mainstream Approaches

Background

Keynes’ General theory: - No self-adjustment of markets- Non-equilibrating markets

Neoclassical economics: - Invisible hand : self-regulation arguments- Existence/stability of market equilibrium

Role of finance & financial systems

. Central to the analysis

. Triggering the instability & BC mechanisms. Added to the analysis . Optimal allocation of resources to investment

Crisis perspective . Inherent in the system. Endogenously generated

. Transitory phenomenon

. External shock required

Agential behavior . Rejection of the rationality hypothesis in spite of information asymmetries. Key role for Institutional arrangements

. Rational expectations hypothesis

. Imperfections (information asymmetries) perceived as biases

Dynamics Dual dynamics : . Medium term : business cycle / FIH. Long-term dynamic (evolutionary): development of capitalism through historical time

Static : . Equilibrium as reference. Search for natural laws / universal economic mechanisms

Policy implications Intervention / regulation needed Neither intervention nor regulation required / detrimental role of intervention


Method : text analysis (Tropes) Tropes text analysis

Linguistic analysis software Based on cognitive-discursive analysis Language studies center stage in social psychology:

“language is not the mere vehicle of communication that would convey meaning and intention in all transparency. Language is opaque, it is an object that is handled and used so as to exert an action on another

person” (Richard, 2000, p.342, our translation)

Corpus selection and relevance : homogeneity and comparability a common theme: the financial crisis three chronological samples: pre-2007, 2007-2008, post 2008 a common article/text format: opinion articles (edito) taken from the specialized press

=> 3 representative press sections in the US, the UK, France (representativeness & readership criteria)

(Given our focus on financial media discourse, academic papers are ruled out from the onset)=> a data base of 300 articles (100 per chronological sample)

A common enunciative stance; to achieve coherence in the comparison

Exploratory results & method based on 3 editorials from the same author (M. Wolf) and the same title (Financial Times).

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Tropes Semantic analysis

Text style identification

Word categorization

Conceptual apparatus (relations : predecessor / successor, acted / actant)

=> Linguistic analytical grid : relations (actant -> acted) and narrative, may indicate the internal workings of the conceptual scheme embedded in the text

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Exploratory & methodological test

Sample (corpora) :

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Exploratory results (corpus1)

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Graph 1a Representative field 1 (Tropes software)

Central,acted

actant

12th International Post Keynesian Conference UMKC, Sept 25-27, 2014 8Pilkington - Sinapi

Graph 1b Relations connecting ‘world’ and ‘economy’ in corpus 1

predecessor

successor


Exploratory results (corpus 2)

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Graph 2a Representative field 1 (Tropes software)

Remains the central representative field

Corpus 2' threefold argumentation: the crisis is the most severe since the 1930s (1), economic recovery will thus require mass scale government intervention (2) and the previous "unbalanced" economic regime will not be restored (3)

previously actant, has become acted, and has moved much closer to the center


Graph 2b Relations connecting ‘world’ and ‘economy’

Semantic fields : the reference "shock" has disappeared, while new items hint at a more Keynesian-oriented mindset (i.e.: "demand", "spirit")

A slight shift in the underlying theoretical framework?


Exploratory results (corpus 3)

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Graph 3a Representative field 1 (Tropes software) Corpus 2 argumentation : 'The consensus view of the world economy has become more optimistic, for good reason''. General argument is one of measured optimism in the light of a sustained recovery at the global level.

Finance again the central reference, but most fields have changed

"crisis" acted => suggesting that the crisis is endogenous to the financial system. (sharp contrast with first corpus "shock")


Graph 2b Relations connecting ‘growth and ‘economy’ in corpus 3 (Tropes extract)

“Economy” continues to occupy a central position, but the latter is connected to ‘growth’ and ‘debt’

Crisis : both predecessors and successors (field 1), which may indicate some sort of reflexive conceptual apparatus(id. For 'debt', field3


Graph 2c Relations connecting ‘economy’ and 'debt' in corpus 3 under Tropes


Corpus comparison: frequencies of references

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Table 1 Top 10 significant (conceptually relevant) references

rankCorpus 1 : pre-crisis

absolute frequency

relative frequency

Corpus 2 : crisis

absolute frequency

relative frequency

Corpus 3 : post-crisis

absolute frequency

relative frequency

1 money 12 1,1% crisis 13 1,1% growth 15 1,4%2 oil 10 0,9% deficit 9 0,8% economy 12 1,1%3 deficit 9 0,8% demand 7 0,6% crisis 8 0,7%4 growth 8 0,7% economy 6 0,5% income 8 0,7%5 account 5 0,5% national_income 5 0,4% debt 6 0,5%6 rise 4 0,4% unemployment 4 0,3% shortfall 3 0,3%7 economy 4 0,4% output 4 0,3% reform 3 0,3%8 shock 4 0,4% surplus 3 0,3% weakness 3 0,3%9 national_income 4 0,4% growth 3 0,3% decline 3 0,3%10 finance 4 0,4% rescue 3 0,3% bank 3 0,3%


Table 2 List of 'most frequent references': an attempt at semantic classification


Concluding remarks Exploratory results suggests a slight shift in embedded linguistic frames (cf. relations analysis :

towards a more reflexive apparatus regarding economy, crisis, debt) and semantic analysis (representative fields, references frequencies) in crisis perception and related mechanisms Suggests a more Minskian understanding of the financial crisis, or at least a stronger intellectual

influence of the latter in financial media discourse, whereas it was previously absent before the crisis

Important limitations of our approach, which remains exploratory and methodologically oriented corpus is voluntarily restricted for convenience purposes the method is limited to semantic analysis and the use of a single software program (i.e. Tropes)

Nonetheless : crisis-related discourse from a linguistic, albeit embryonic, standpoint, helps us make concrete recommendations for future research more extensive empirical linguistics analysis much larger database (of three hundred articles) structured around subtler time intervals and divided

between the French and the Anglo-Saxon press linguistic concepts derived from frame semantics, in order to complement the analysis conducted with

Tropes

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“[t]hose who cannot remember the past are condemned to repeat it”

George Santayana (1905, p.284)

Pilkington - Sinapi

Crisis Perception in Financial Media Discourse : A concrete application through the Minskian /...

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