Week 11

Question 1

Define Choice Architecture also what is the Prefrontal Cortex and Limbic system?

Answer 1

Choice Architecture: is the practice of influencing choice by “organizing the context in which people make decisions.”

To Put Things Simply:

• Choice architecture means how choices are set up.
• Even if the options stay the same, the way they’re shown can change what people pick.
• It’s like arranging the environment to make good choices easier.

Prefrontal Cortex [also referred to as System 2]
Limbic system [System 1]

Question 2

What are the 6 Tools of Choice Architecture

Answer 2

There are the things that guide people to making better choices:

1. Defaults
   How it works: People stick with pre-set options out of habit or effort avoidance
   Example: Opt-out organ donation = 90% participation vs. opt-in = ~30%
   ✅ Insight: Set smart defaults—most people won’t change them
2. Feedback
   How it works: Gives real-time or regular updates to guide behavior
   Example: Utility bills showing your usage vs. neighbors
   ✅ Insight: Best when it’s frequent, specific, and actionable
3. Incentives
   How it works: Changes the value of choices by making costs/benefits more immediate or visible
   Examples:
   Thermostat showing money saved
   Incentive mismatch when tenants use utilities but landlords pay
   ✅ Insight: Always ask: Who uses? Who chooses? Who pays? Who profits?
4. Error Expectancy
   How it works: Designs systems that anticipate and reduce mistakes
   Example: Online forms that flag errors before submission
   ✅ Insight: Assume mistakes will happen—build in safeguards
5. Mapping
   How it works: Links choices to consequences in a clearer way
   Example: Calorie charts next to fast food items
   ✅ Insight: Helps people grasp abstract trade-offs
6. Structuring Complex Choices
   How it works: Organizes and simplifies overwhelming decisions
   Example: Investment platforms offering simplified portfolios (e.g., “Balanced,” “Growth”)
   ✅ Insight: Fewer, grouped choices help avoid analysis paralysis

Question 3

Define the Four Dimensions to Categorize Nudges:
Boosting Self-Control vs. Activating Desired Behavior,
Externally-Imposed vs. Self-Imposed,
Mindful vs. Mindless,
Encouraging vs. Discouraging Behavior

Answer 3

1. Boosting Self-Control vs. Activating Desired Behavior:
   § Boosting Self-Control: Assisting individuals in resisting undesirable behaviors.
   § Activating Desired Behavior: Encouraging engagement in beneficial behaviors.
2. Externally-Imposed vs. Self-Imposed:
   § Externally-Imposed: Nudges introduced by external entities.
   § Self-Imposed: Nudges initiated by individuals upon themselves.
3. Mindful vs. Mindless:
   § Mindful Nudges: Encourage deliberate decision-making.
   § Mindless Nudges: Influence behavior subconsciously through emotional or framing techniques.
4. Encouraging vs. Discouraging Behavior:
   § Encouraging: Promote engagement in specific behaviors.
   § Discouraging: Deter individuals from particular actions.