Task 1: Nudging Flashcards
Definition Nudging
pushing someone gently towards a desired behavior
-> changing the presentation of choice options in a way that makes the desired choice the easy, automatic and default option
What does nudging not do?
nudging alters alters people’s behavior in predictable ways without restricting any options or significantly changing their economic incentives such as time or money
Nudging principals
- simplification and framing of information
- changes to the physical environment
- changes to the default option
- use of (descriptive) social norms
Nudges are appropiate when
- choices have delayed effects,
- when they are complex or infrequent and thus learning is not possible,
- when feedback is not available, and
- when the relation between choice and outcome is unclear
the two major appeals of nudges
- they preserve autonomy because they make some actions easier to select without restricting anything
- they reduce errors and biases by encouraging people to make better decisions “as judged by themselves” -> nudges help people do what they would otherwise do if they had put more time and energy into their choices
= if the choice options could be rearranged in ways that make the healthy choices the easiest and most automatic options, consumers may be helped to behave in healthier ways without much effort
Libertarian paternalism
characterizes the attractive regulation paradigm that arises out of the “nudge approach” to behavioral change in public policymaking, when enacted to serve the interests of the citizens as these are judged by themselves “nudging for good”
What types of nudges are there?
- type 1 nudge = aimed at influencing the behavior maintained by automatic thinking, or consequences thereof without involving reflective thinking (default plate size to influence consumption) automatic system
- type 2 nudge = aimed at influencing the attention and premises of – and hence the behavior anchored in – reflective thinking (i.e. choices), via influencing the automatic system (fly in the urinal, framing) reflective system
Epistemic transparency
degree to which the target of a nudge can be aware that they are being nudged
transparent nudge
= a nudge provided in such a way that the intention behind it, as well as the means by which behavioral change is pursued, could reasonably be expected to be transparent to the agent being nudged as a result of the intervention (fly in the urinal)
-the citizen nudged can reasonably be expected to be able to easily reconstruct the intention behind the nudge
non-transparent nudge
nudge working in a way that the citizen in the situation cannot reconstruct either the intention or the means by which behavioral change is pursued (shrinking of plate sizes aimed e.g. at reducing calorie intake)
Dual process/systems consideration
there are two ways of thinking about changing behavior, the „rational‟ or „cognitive‟ model (reflective) VS the „context‟ model (automatic) of behavior change with are based on the reflective and the automatic system of the Dual Process model
the „rational‟ or „cognitive‟ model
based on influencing what people consciously think about
-standard model in economics and public policy
-citizens and consumers presumably will analyze the various pieces of information from politicians, governments and markets, the numerous incentives offered to us and act in ways that reflect their best interests
-based on reflective system: limited capacity, but offers more systematic and
„deeper‟ analysis.
- the „context‟ model of behavior change =
- focuses on more automatic processes of judgment and influence
- recognizes that people are sometimes seemingly irrational and inconsistent in their choices, often because they are influenced by surrounding factors
- focuses more on „changing behavior without changing minds‟ altering the context in which people act
- based on automatic system processes many things separately, simultaneously, and often unconsciously, but is more „superficial‟: it takes short-cuts and has ingrained biases
What makes a nudge effective?
nudges are appropriate when:
- choices have delayed effects,
- when they are complex or infrequent and thus learning is not possible,
- when feedback is not available, and
- when the relation between choice and outcome is unclear
general facts on nudge effectivness
- evidence seems to show that making individuals aware of a nudging intervention may not affect its effectiveness (transparency makes no difference to effectivity)
- reducing the set of options, while keeping all choices available, can facilitate decision-making outcome and experience, and thus contribute to designing better nudges
- middle-choice option: when faced with simultaneously presented choices, people tend to choose the choice option positioned in the middle
‘Nudge Theory’ Toolkit (Thaler & Sunstein)
- Understand and validate the required change
- Check for obstacles
- Check for unhelpful existing nudges
- Remove obstacles and establish support
- Explore which environmental/circumstantial factors can be altered/introduced (=the nudge)
Attitudes toward nudges:
-> investigate four factors that shape attitudes toward nudges
(concept of ‘‘one nudge fits all’’) is not tenable
- ) a top-down framework for categorizing nudges:
- transparent VS non-transparent
- pro-self VS pro-social nudges
- system 1 (unaware, by relying on implicit defaults) VS system 2 (more transparent, prompts choice) - ) individual dispositions in personality traits and political views that may be associated with support or opposition for nudges
- ) perceptions of nudges that may help explain the relationship between nudge categories and individual dispositions (e.g., system 1 nudges may be perceived as more manipulative)
- ) persuasive framing of nudges which might change attitudes of those with different individual dispositions
- people were more supportive of nudges when the frame or the rationale for the policy targeted “people in general” rather than “you”
MINDSPACE framework
consists of 9 influences on behavior
- can be used as a quick checklist when making public policy or developing or implementing a nudge
- is a mnemonic (each letter stands for one influence)
- N, D, S, P, A focus on automatic effects on behavior
- M, I, C, E focus on reflective processing
Messenger
-we are affected by the perceived authority of the messenger
-> people are more likely to act on information if experts deliver it
-demographic and behavioral similarities between the expert and the recipient can improve the effectiveness of the intervention
-we are also affected by the feelings we have for the messenger
we may irrationally discard advice given by someone we dislike
Incentives
- the five main, related insights from behavioural economics are that:
- losses loom larger than gains: We dislike losses more than we like gains of an equivalent amount
- reference points matter: the value of something depends on where we see it from – and how big or small the change appears from that reference point
- we overweight small probabilities: lotteries may act as a powerful motivation
- we mentally allocate the money to discrete bundles: We think of money as sitting in different “mental budgets” – salary, savings, expenses, etc.
- Spending is constrained by the amount sitting in different accounts and we are reluctant to move money between such accounts
- mental accounting means that identical incentives vary in their impact according to the context: people are willing to take a trip to save £5 off a £15 radio, but not to save £5 off a refrigerator costing £210
- we live for today at the expense of tomorrow: We usually prefer smaller, more immediate payoffs to larger, more distant ones.
Norms
social norms constitute an important source of social influence
- descriptive: what others are perceived to do what others do
- injunctive: what is commonly approved what should be done
- five lessons for policymakers from norms:
1. If the norm is desirable, let people know about it
2. Relate the norm to your target audience as much as possible.
3. Consider social networks
4. Norms may need reinforcing
5. Be careful when dealing with undesirable norms
Defaults
- defaults are the options that are pre-selected if an individual does not make an active choice
- defaults exert influence as individuals regularly accept whatever the default setting is, even if it has significant consequences
- structuring the default option to maximize benefits for citizens can influence behavior without restricting individual choice
Salience
people are more likely to register stimuli that are novel (messages in flashing lights), accessible (items on sale next to checkouts) and simple (a snappy slogan)
-we look for an initial „anchor‟ on which to base our decisions à they work even if they are totally arbitrary
Priming
- people’s subsequent behavior may be altered if they are first exposed to certain sights, words or sensations
- primes do not have to be literally subliminal to work, many things can act as primes, including: words, sights, smells
Affect
affect (the act of experiencing emotion) is a powerful force in decision- making
-affect can be very powerful, but should be used with care by policymakers
it was unhelpful to „create fear without agency‟ – in other words, to create an emotional reaction without obviously connecting it to a change in behavior
Commitment
-we tend to procrastinate and delay taking decisions that are likely to be in our long-term interests
-commitments usually become more effective as the costs for failure increase
make commitments public, since breaking the commitment will lead to significant reputational damage
Ego
-we tend to behave in a way that supports the impression of a positive and consistent self-image
-fundamental attribution error: When things go well in our lives, we attribute it to ourselves; when they go badly, it’s the fault of other people, or the situation
-we also like to think of ourselves as self-consistent.
-when our behavior and our self-beliefs are in conflict it is often our beliefs that get adjusted, rather than our behavior
-used in the foot-in-the-door technique: asks people to comply with a small request, which then leads to them complying with larger and more costly requests
-small and easy changes to behavior can lead to subsequent changes in behavior that may go largely unnoticed
challenges the common belief that we should first seek to change attitudes in order to change behavior
