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How TV Show Finales Affect The Stock Market


So what happens now now that "Mad Men" is over? This is a real question that researchers have studied, and NPR's social science correspondent Shankar Vedantam is here to tell us about it. Hi, Shankar.


INSKEEP: What's the research?

VEDANTAM: Well, the research tells us that after watching "Mad Men," we now have to watch the stock market, Steve.


VEDANTAM: And here's why.


VEDANTAM: Gabriele Lepori from Keele University in the United Kingdom was looking for ways to study the effects that fictional characters have on us and he hit on the idea of studying the effects of TV show finales in the U.S. He has studied more than 150 popular TV show finales, starting with "The Fugitive" in August 1967, running through "The Cosby Show," "Seinfeld" and "Friends." He's an economist and he was curious if TV finales had any effect on finance, specifically on the stock market.

GABRIELE LEPORI: What I find is that when a TV show ends, I observe a decrease in stock returns on the following trading day. The higher the number of TV viewers for that episode, the larger the decrease in stock returns on the following day.

INSKEEP: Wait a minute. The stock market goes down the morning after a finale? Why would that be?

VEDANTAM: Well, it doesn't make sense at a certain level. What Lepori is saying is that the markets do worse after these big TV finales because people are in mourning in a way, and when they're morning, they become more risk averse and they shy away from the markets. What he's saying is that the emotional ties that people have to TV characters makes them feel the same way about the fictional characters as they do about actual people in their lives. Here he is again.

LEPORI: Since we see them every week, we tend to develop an emotional attachment with them. So that when we lose them because, say, a TV show ends, we tend to experience a negative emotional reaction that is similar to the reaction we would experience when a real relationship ends.

INSKEEP: This sounds crazy, but it sort of makes sense. You get to know Don Draper. You follow his back story.

VEDANTAM: (Laughter).

INSKEEP: You sense you relate to him or relate to the women in his life or any number of characters. Sure.

VEDANTAM: Yeah. You know, there's a lot of interesting work on this from evolutionary psychology, Steve. Some psychologists have made the argument that for most of our evolutionary history, the only characters we saw around us were real people who were physically around us.


VEDANTAM: Today, a lot of the faces and voices we hear around us come from technology. And at a conscious level, we know those people are not actually in our physical presence. But at an unconscious level, the machinery in our brains, which evolved in this different time period, makes us feel as though these people are actually our real companions. And so this is why when people hear about scandals and gossip involving celebrities or politicians, we react to those scandals and that gossip as if we're hearing about actual people in our lives when in fact we have no connection with those people whatsoever.

INSKEEP: OK, so "Mad Men" is over. If stock traders are listening, should they plan to make money somehow in the market going down today?

VEDANTAM: (Laughter) Well, for one thing, you would have to do this over a very long time period to see an effect, Steve.

INSKEEP: Oh, because it doesn't always happen. OK, Fine.

VEDANTAM: Yeah. So Lepori is finding an average effect over 150 shows, so it might not work every time. Second, of course, by talking about this here on NPR, millions of people now know the stock market might dip today and this can confound the effect. The problem is every time you talk about human behavior, you change the thing that you're talking about.

INSKEEP: Shankar, good luck on your trading.

VEDANTAM: Thank you so much, Steve.

INSKEEP: He's not actually trading, people. That's NPR social science correspondent, Shankar Vedantam. And you can follow him on Twitter as always @HiddenBrain. Follow this program @MorningEdition, @NPRInskeep, @nprmontagne, @nprgreene. Transcript provided by NPR, Copyright NPR.

Shankar Vedantam is the host and creator of Hidden Brain. The Hidden Brain podcast receives more than three million downloads per week. The Hidden Brain radio show is distributed by NPR and featured on nearly 400 public radio stations around the United States.