Nudges (How to change people!)

Behavioural Economics Team of the Australian Government, or BETA
Behavioural insights units - NSW Govt
Penn Medicine Nudge Unit
London-based Behavioural Insights Team

“A nudge, as we will use the term, is any aspect of the choice architecture that alters people's behaviour in a predictable way without forbidding any options or significantly changing their economic incentives. To count as a mere nudge, the intervention must be easy and cheap to avoid. Nudges are not mandates. Putting fruit at eye level counts as a nudge. Banning junk food does not.” (Thaler and Sunstein 2008, p. 6)

Behavioural Economics deals with the effects of psychological, social, cognitive, and emotional factors on decisions. What matters is not what people say they will or do, in a survey, but what actually happens. Be aware that cognitive basis are not robust across place and time and culture so the nudge may not be long term without tangible benefits.

This is what marketers and advertisers use all the time to make us buy all this stuff we don't need!

Examples of nudges I have found interesting:
(please send me any dental examples

How to 'nudge'?
The easiest way of thinking about a nudge is to look at the EAST framework from London-based Behavioural Insights Team . EAST = Easy, Attractive, Social, Timely





What's the theory underpining this change theory?

Our decisions are moved from "rationality" by 3 factors

  1. Cognitive limitations
  2. Self-control problems
  3. Self-interest or social preferences; messanger effect; committment; removing friction costs; goal setting

1. Cognitive limitations
a) Perceptions
Optimism bias - we overweigh low probablities
Pessimism bias - we underweight high probablities
Status quo bias - any change is perceived as a loss
E.g. they have shown that we under-estimate how long it will take to travel somewhere in the car so if you tell people how long it will actually take it relieves some of the road rage!
Salience: More likely to respond to novel, simple accessible information
b) Loss and risk aversion
People usually are more sensitive to losses than gains. Hence how you frame information effects people behaviour.
Ambiguity: People perfer choices with known favorable outcomes
Overload: More choices can result in inefficient choices.
Friction: Small, seemingly irrelevant details can make a stask more challenging
c) Defaults
Individuals tend to choose default options
Using novelty techniques e.g. gameification or taking advantage of disruptions could help individuals explore more beneficial alternatives - but they must actually provide tanglible value.

2. Limited Self-control
Future outcomes: People discount outcomes that present themselves in the future. This is difficult to modify but this can be helped by a) experiencing future via virtual reality b) anchoring future outcomes.
Limited time offers can reduce procrastination.

3. Self-interest or social preferences
a) Committment - encourage committment and then remind people about it
b) Goal setting - making a plan can help. Working together on a team challenge or coaching others
c) Messenger effect - how and who effects outcomes
d) Reciprocity - obligation to return a favor
e) Social comparision (being able to rate yourself to your peers on safety, improved safety)
f) Social norms