A Rorschach economy

In 1921, a Swiss psychologist named Hermann Rorschach published a test where patients’ responses to ten inkblots were recorded and analysed. He died soon thereafter and never saw his images and associated test system become widely used and well known, but also controversial among psychologists. The popular understanding of the Rorschach test – that everyone sees different things in the inkblots, and that what you see says a lot about you – is obviously oversimplified. But it is a useful analogy. Often, judgement is in the eye of the beholder. This is clearly the case in art and aesthetics but can also be the case in economics and investing.