Nudges: Knowing Where and When They'll Work

A person's environment plays a key role.

Posted Nov 07, 2018

In a recent article that I and colleagues published (B Meder, N Fleischhut, M Osman) in the Journal of Economic Psychology, we identify an often neglected point, that behavioral interventions (nudge-like or otherwise) are situated within a more broadly defined environment that encompasses a variety of physical, political, and socio-economic factors. So, to understand when nudges might or might not work, we (researchers, practitioners, policy makers) need to consider, in a more systematic and detailed way, the context is in which we make decisions, and how it interacts with the kinds of nudges introduced to help make our lives better. 

For instance, the presence of an obesogenic environment (e.g. Swinburn, Egger, & Raza, 1999), where there is an easily accessible abundance of energy-dense food (e.g., multiple fast food outlets on our high streets), can easily offset the efforts of soft behavioral interventions (e.g., health food campaigns) that are designed to try to help us avoid an unhealthy diet.

There are many examples of the kind just mentioned, in which nudge-like attempts to help improve our choice behavior are undermined by neglecting to look at the broader aspects of the "choice architecture"—put simply, the specific context in which we make decisions, such as which of the food options on a menu we pick to eat). 

To address this, in our paper we consider five types of environments: 1) underutilized environments, 2) unprepared environments, 3) counteracting environments, 4) compensatory environments, and 5) heterogeneous environments. We use different real-world examples to illustrate each of these, and try to show ways of thinking about solutions to problems that are raised. Alongside this, we present a decision tree that can help provide a practical guide as to structuring the kinds of questions policy makers could ask, and how they might correspond to each of the five environments we have characterized. 

In general, the aim of this paper is to introduce work by ourselves and others that highlight the critical role of the environment in designing, implementing, and evaluating behavioral interventions, such as nudges.

Our conclusion is that effective policy making around the use of behavioral interventions often requires coordinating different behavioral interventions with more traditional policy-making tools; this is best illustrated in the observed increase in smoking cessation rates globally over the past 10 to 15 years, which are, in part, the result of a combination of traditional regulatory tools such as bans, taxes, mandates, as well as soft behavioral interventions, such as educational campaigns and health warnings on cigarette packages.

Understanding the broad environment in which we make decisions is an effort that requires the combined expertise of sociologists, psychologists, anthropologists, behavioral economists, economists, political scientists, human geographers, and a host more. Once we characterize the environment in richer terms, that means going beyond the confines of the choice architecture, then we will be better armed to find ways of supporting solutions to address social policy problems. 

References

Meder, B., Fleischhut, N., & Osman, M. (2018). Beyond the confines of choice architecture: A critical analysis. Journal of Economic Psychology.

Swinburn, B., Egger, G., Raza, F., 1999. Dissecting obesogenic environments: The development and application of a framework for identifying and prioritizing environmental interventions for obesity. Preventive Medicine 29, 563–570.