Economic history shows us the importance of a narrative. If Rachel Reeves wants to help the economy, she needs to learn how to tell a story, writes Paul Ormerod

Macroeconomists spend much of their lives immersed in highly mathematical models of the economy.

But at the top of the profession there is increasing interest in a much older tradition of what really drives the economy: namely, narratives – the story which people believe can be the key determinant of behaviour.

Everyday commentary on the economy recognises the importance of the concept. For example, at the start of this week the S&P Consumer Confidence Index fell sharply, and the press release referred to the “sense of unease which permeates across British households”. This unease will translate itself into a reluctance to spend.

The idea has been around for a long time.

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Since the 1930s, Keynes has become........

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