The economic unconscious: Towards a psychoanalytic macroeconomics
Year: 2026
Type: article
Abstract: This paper introduces psychoanalytic theory into macroeconomics, arguing that economic crises emerge not from rational miscalculations but from unconscious drives, such as repression, denial, and repetition compulsion. Inspired by Freud and Lacan, we theorize macroeconomic narratives as symbolic structures that repress structural contradictions, which periodically return as crises. Using Turkey’s ‘interest rates cause inflation (or lowering interest rates will lower inflation)’ discourse as empirical material, we demonstrate how collective denial sustains unsustainable booms until symbolic breakdown forces traumatic adjustment. This approach moves beyond behavioural economics’ cognitive biases to examine the libidinal economy underlying aggregate dynamics. We conclude by outlining a research programme for psychoanalytic macroeconomics that treats markets as sites of unconscious desire rather than rational calculation.
Source: Cambridge Journal of Economics
DOI: 10.1093/cje/beag032
Author: Ceyhun Elgin
Institution: Boğaziçi University
Language: English
Subfield: Clinical Psychology
Field: Psychology
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $4,514
OpenAlex ID: W7223654340