Friday, June 11, 2010

The rise of austerity

Here is an interesting graph showing the number of Google searches for the word "stimulus" as a proportion of all Google searches, from January 2008 to today:

And here is the same period, looking at the relative popularity of the term "austerity":

Stimulus peaked twice and now seems fairly stable, while austerity peaked recently and is now still a lot higher than before. I wonder if this indicates a change in narrative over the economic crisis? Instead of stimulating economies with state intervention there is a greater emphasis on cutting deficits.

I'm not sure though. Taken together, the two search terms look like this:

Stimulus is still far in the lead. The words austerity and stimulus also have meanings unrelated to economics, which muddies the data. Still, the rise of austerity searches does seem to mirror an increased emphasis on several European countries - particulary Greece, Ireland and Spain - to slash government budgets and raise taxes in order to reduce deficits.

Am I imagining a change in narrative? Not if Google's news reference volume graph is a reliable indicator:

That's stimulus in red, gradually making fewer news articles, while austerity in blue perks up in 2010. I wonder if the whole debate is beginning to shift.

1 comment:

  1. Article on BBC a few days ago:

    "As the Nobel prize-winning economist Joseph Stiglitz has pointed out, the European economies seem to be embracing the policies of Herbert Hoover.

    He was the US president who carefully guided the American economy into the Great Depression after the Wall Street Crash, by worrying over-much about the deficit.

    Cutting deficits at a time when the European economy is struggling out from under the dead weight of near-zero growth will, he believes, condemn economies such as Greece, Portugal and Spain to years of grinding poverty.

    The brief rekindling of the love affair with Keynes appears to be over."
    http://news.bbc.co.uk/2/hi/business/10241838.stm

    I don't know about the opinion, but it seems to be broadly what these graphs indicate: less discussion of stimulus, more of budget cuts.

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