Yves here. We’ll take some of the fun out of using this article as a reader critical thinking exercise by pointing out the obvious up front. This piece is garbage in, garbage out. Or perhaps more accurately, (not surprising for a piece about capitalism) it falls into the “drunk looking under the streetlight” category by analyzing readily available data, as opposed to squishier metrics that would better represent changes in news production and consumption over time.

The underlying study mined only at articles in large, mainstream publications. This approach assumes continuity when that is not at all the case. It ignores the rise of social and independent media and the continuing plunge of trust in mainstream media outlets. For instance, even here in Southeast Asia, when I run into expats who ask about me and I describe the site, most snort that they don’t trust the news and consume it less than they once did.

In addition, it ignores the large shift in the class composition of newsrooms over time. As we have mentioned often, save perhaps at the New York Times, reporters generally came from working class backgrounds. That gave most a native skepticism of taking what business and political leaders said at face value. But now, the surviving institutions have a heavy representation of graduates of Ivies or equivalent schools who want to be welcome at the “right” parties. On top of that, the loss of classified ad revenues has hollowed out newsrooms, making the press more dependent on “access” stories. That gives the powerful yet another leverage point over the media, since they can freeze reporters who aren’t sufficiently compliant out of the information tidbits they spread around.

Specifically, it seems difficult to believe that the perception of socialism in the US remained flattish over the time of Sanders’ two campaigns. It was at least somewhat reported that being a socialist had become popular among teens and young adults. But then again, that cohort is too young to be a big target for ad dollars, so major publications were unlikely to shift their messaging to increase appeal to this cohort.

To put it another way: the father of modern public relations, Eddie Bernays, determined in 1926 that half the stories on the front page of the New York Times were propaganda. What would you guess the proportion is now? And what do non-US readers guesstimate the shifts in sentiment

By Jay L. Zagorsky, Associate Professor of Markets, Public Policy and Law, Boston University, and H. Sami Karaca, Professor of Business Analytics, Boston University. Originally published at The Conversation

Capitalism, communism and socialism are the world’s three major economic systems. While the phrase “economic system” may seem like a yawn, countless people have fought and died in major wars over which one should dominate.

Shifts from one system to another, like the 1989 fall of communism in much of Eastern Europe, changed the lives of millions. And while researchers know that a country’s economic system dramatically impacts people’s living standards, less is known about how attitudes toward these systems have changed over time.

We are professors working at Boston University’s new Ravi K. Mehrotra Institute, which is trying to understand how business, markets and society interact. Given many recent criticisms of capitalism, we were surprised to find positive sentiment toward capitalism is slowly rising over time.

The Main Economic Systems Explained

Capitalism, communism and socialism are economic and political systems that differ in their principles and organization. Capitalism emphasizes the private ownership of resources and the means of production, driven by profit and market competition, with minimal government intervention.

Communism, on the other hand, advocates for a classless society where all property is communally owned. In communism, wealth is distributed according to need and there is no private ownership, which aims to eliminate inequality and oppression.

Socialism falls between these extremes. It focuses on the collective or state ownership of key industries and resources. This allows for some private enterprise, with the aim of reducing inequality through social welfare programs and obtaining a more equitable distribution of wealth.

Modern economies blend capitalism with socialism to address challenges like inequality, market failures and negative externalities, like when a business harms the environment. Governments intervene through regulations, welfare programs and public services to tackle issues like pollution and income inequality. This creates what economists call a “mixed economy.”

The amount of state involvement varies from country to country. At one end is market capitalism, where markets dominate with a limited government role. The U.S. is one such example.

At the other end is state capitalism, like in China, where the government directs economic activity while incorporating market elements. The goal is to combine market efficiency and innovation with measures to contain capitalism’s social and economic costs.

How to Measure People’s Attitudes Toward Economic Systems

Some surveys have asked people directly how they feel about these systems.

For example, the Pew Research organization’s most recent survey on the issue found the proportion of Americans with positive views of either capitalism or socialism has declined slightly since 2019, with capitalism remaining more popular overall. Nevertheless, Americans are split sharply along partisan lines. About three-quarters of Republican voters have positive views of capitalism, compared with less than half of Democratic voters.

Unfortunately, there are no long-running surveys tracking people’s feelings toward the three systems. Because of this shortcoming, we used artificial intelligence to analyze references to the three systems in more than 400,000 newspaper articles published over a span of decades.

We identified every news story that discussed capitalism, communism or socialism using ProQuest’s TDM Studio. ProQuest has digitized almost all the articles in major English-language newspapers – including The Wall Street Journal and The New York Times – starting in the mid-1970s, with partial archives from earlier years.

The AI model was designed to assess the tone of each article across several dimensions, including anger, surprise and happiness. After the model scored each article on those qualities, we combined the emotions into three categories: positive, negative, and neutral or unknown. For example, an article discussing capitalism might be rated as 60% positive, 20% negative and 20% neutral.

Using an AI large language model allowed us to track shifts in press attitudes over time – which, to be fair, might not match popular opinion.

How Views Have Changed Since the 1940s

When we looked at newspaper articles from the end of World War II to the present, we found something unexpected. In the 1940s, capitalism was not well regarded. The average article containing “capitalism” or “capitalist” got a 43% negative and 25% positive sentiment score. This is surprising, since we looked at newspapers published primarily in countries with capitalist systems.

However, just because capitalism didn’t get a high positive score doesn’t mean that newspaper writers loved communism or socialism. In the 1940s, articles with those words also got relatively high negative scores: 47% on average for articles containing “communism” or “communist,” and a 46% negative rating for “socialism” and “socialist.”

Since that time, however, positive sentiment toward capitalism has improved. In the 2020s, the average article with capitalism got a more balanced 37% negative and 34% positive sentiment score. While capitalism clearly isn’t loved in the press, it’s also not disparaged as much as it was just after World War II.

The news media’s attitudes toward capitalism improved more than attitudes toward socialism or communism over time. In the 1960s, positive attitudes toward all three were roughly the same. Today, however, positive sentiment toward capitalism is 4 or 5 percentage points higher than the other two. The climb wasn’t steady, since the number of favorable articles about capitalism fell during recession years.

Still, some contemporary commentators fret that capitalism is in crisis.

Not long ago, The New York Times – a newspaper located in the world’s financial center – ran an op-ed headlined “How Capitalism Went Off the Rails.” A recent book review in The Wall Street Journal, a newspaper that is a bastion of capitalism, starts, “Our universities teach that we are living the End of Times of ‘late capitalism.’”

But while capitalism clearly isn’t beloved by all, we didn’t find evidence that it’s being overtaken by socialism or communism. Instead, using AI to process the attitudes reflected in thousands of newspaper articles, we found that people – or at least the press – are slowly warming to it.

This entry was posted in Dubious statistics, Economic fundamentals, Guest Post, Income disparity, Media watch, Politics, Social values, The destruction of the middle class, The dismal science on by Yves Smith.