Task 1 Flashcards
Nudge Definition
Any aspect of the choice architecture that alters people’s behaviour in a predictable way without forbidding any options or significantly changing their economic environment
(choice architecture = aspect of social/physical environment that makes a particular option more attractive, preferred or even the default choice)
- changing the behaviour, NOT attitude without blocking any options or making one option much better than the others (not making them more costly or so), no consequences
- choice preserving approach that steers people in a particular direction, but that allows them to go their own way
- should be easy and cheap to avoid –> no mandates
- umbrella term for deliberate & predictable methods of changing ppl behaviour by modifying the cues in the physical and/or social context in which they act
> uses these cues to activate unconscious thought processes involved in human decision-making
Goal of (many) nudges
- steer someone towards a specific option & away from alternatives
- make life simpler for people to navigate (road signs, education campaigns)
- still preserve freedom of choice
- to inform ppl & ensure that their choices are informed
Principles of nudges
- Simplification & framing of information
- changes to the physical environment
- changes to the default option
- use of (descriptive) social norms
Prospects of nudges
- evidence-based
- testing of interventions in real-life context
- randomised control trials
What is NOT a nudge?
- prompts
- banning junk food, blocking stairs so that people use elevator
Dual Process Theory
theory behind nudging
slow, conscious process
vs
quick, effortless, non conscious process
Nudge Theory
Nudge Theory Toolkit:
- Understand & validate the required change
- Check for obstacles
- Check for unhelpful existing nudges
- Remove obstacles & establish support
- explore which environmental/circumstantial factors can be altered/introduced (=the nudge)
Dual systems theory in real life
- Behaviours are guided by processes that operate outside of conscious awareness
- many decisions not made based on lengthy deliberate thinking but quick & automatic heuristic processing
- ppl often do not have time/motivation/cognitive resources to carefully & consciously think through all decisions they make throughout they
System 1 nudge
explanation
- nudges take advantage of unconscious interaction between person & environment
- -> System 1 way of thinking
- making use of flaws that affect automatic unconscious processes & passive decision-making (like ppl don’t give full attention to their options) then to follow path of “least resistance”, they lack clear preferences & complete information and choices will inevitably be influenced by default rules, frames & starting points
Benefits of nudges
- low or no costs
- sometimes deliver prompt results
- maintain freedom
- can be highly effective
- sometimes more impact than more expensive & coercive tools
When are nudges appropriate?
- when choices have delayed effects
- perhaps no benefit in moment but later (stairs & health) - when they are complex or infrequent & thus learning is not possible
- When feedback is not available
- When the relation between choice & outcome is unclear
Thaler & Sunstein
Types of nudges
- changing standard options
- changing physical environment
- providing the possibility of correct impulsive choices
- providing feedback on choices
Hansen & Jesperson
Types of nudges
4 categories:
- unconscious vs conscious
transparent vs non-transparent
System 1 Nudge
- e.g defaults and sequential orderings
- uses automatic cognitive processing
- viewed less favourably than System 2 nudges
- perceived as more autonomy threatening
- System 1 nudges more likely to operate without awareness of decision maker by relying on implicit defaults and status quo options
- can be more automatic
- operate less directly on cognition and more directly on behaviour
–> perceived as more autonomy threatening
System 2 Nudge
- e.g. educational opportunities or reminders
- uses more deliberative processing
- more effortful and more transparent
- viewed as more effective for better decision making and more necessary for changing behaviour
- nudges provide information (& possibly education) that may make people more aware & presumably more thoughtful about their decisions
–> perceived as more effective for making good decisions and more necessary for behaviour change
Type 1 Nudge (Hansen & Jesperson)
aimed at influencing behaviour maintained by automatic thinking or consequences therefore without involving reflective thinking
- those influencing behaviour that so not involve deliberation, judgement and choice
(e. g. size of plates, narrowing side-lines on roads)
Type 2 Nudge (Hansen & Jesperson)
- aimed at influencing attention and premises of - and hence the behaviour anchored in reflective thinking/choices/inflencing automatic system
- those influencing behaviours best characterised as actions, results of deliberation, judgement and choice
(e. g. fly in urinal)
Transparent nudge
individuals understand expected behavioural change & means by which it likely to occur
Transparent Type 1 Nudge
reflective thinking is not engaged in what causes the behaviour change in question
–> reflective thinking is by-product
e.g. playing relaxing music while passengers board plane to calm them down
Transparent Type 2 Nudge
engages in reflective system in a away that mens it easy for citizen to reconstruct intentions and means by which behaviour change is pursued
e.f. fly in urinal, prompted choice for organ-donation
Non-Transparent Nudge
Individuals less likely to recognise the possibility of behaviour change, and they cannot reconstruct the means by which changes could occur
Non-Transparent Type 1 Nudge
causes behaviour change without reflective system and in a way that doesn’t make it likely to be recognised and transparent
- -> e.g. mindless eating, smaller dinner plates
e. g. changing of background defaults (organ donation)
Non-Transparent Type 2 Nudge
reflective system has to be engaged but doesn’t happen in a way that by itself gives people epistemic accede to intentions and means by which influence is pursued
e. g.
- clever framing of risks aimed to influence one’s decision-making
- aimed at affecting decision-making by clever framing, compliance, anchoring
10 important nudges according to Sunstein
- default nudge
- Simplification of current requirements
- reminders
- eliciting implementation intentions
- use of social norms
- increases in ease & convenience
- disclosure
- warnings (graphics or other)
- recommitment strategies
- informing people of nature & consequences of their own past choices
MINDSPACE (checklist for creating policy & nudges)
list of 9 most robust influences on our behaviour, which can be used as a quick checklist when making policy
- mindpace explores how behaviour change theory can help meet current policy challenges
- policy makers need to understand the effects their policies may be having –> mindspace helps with this
(explore, enable, encourage, engage, exemplary, evaluate)
1. messenger
2. incentive
3. norms
4. defaults
5. salience
6. priming
7. affect
8. commitment
9. ego
Libertarianism
standard assumption of rational choice on economics has lead to a deep-rooted view that governments should take hands-off attitude towards private enterprise & private choice
- free choice
Paternalism
- implementation
- guiding behaviour
- standard tool or paternalistic control in economics have been: taxes & subsidies, simple legal prohibitions
- tools to use if the goal is to influence the choice of rational people
Libertarian Paternalism
compromise between libertarianism & paternalism
- the government nudges private citizen towards rational choices without any way restricting their freedom to do as they wish