Richard Thaler’s latest Economic View column.

As implausible as it may seem, here is a statement that almost everyone in Washington can agree with: Congress has self-control problems. This may just be a sign of democracy. We elect those who share our frailties. We Americans eat too much, take on too much debt, save too little and put off anything mildly unpleasant as long as possible. Psychologists and behavioral economists have studied these kinds of problems for decades. We know, for example, that children have trouble waiting even for a few minutes to get three marshmallows if they can have one now, and they find it particularly hard if they have to look at those luscious treats while waiting.

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It ain’t complicated, reports Farnam Street.

So how does (Joe Girard), who sells one car at a time to everyday customers, go on to become one of the most successful sales people in history? Girard offers a simple answer: “People want a fair deal from someone they like.”

When questioned about what he does to get people to like him, he says “I tell them that I like them.”

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In the U.K., the public transit agency turned to a marketing campaign built around a famous psychology experiment.

In the Netherlands, reports the NYT,

Dutch drivers are taught that when you are about to get out of the car, you reach for the door handle with your right hand — bringing your arm across your body to the door. This forces a driver to swivel shoulders and head, so that before opening the door you can see if there is a bike coming from behind. Likewise, every Dutch child has to pass a bicycle safety exam at school. The coexistence of different modes of travel is hard-wired into the culture.

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The Telegraph reports that having patients write down the details of their appointment themselves could save the NHS £250 million a year.

Traditional approaches to the problem have included sending reminder letters and putting up posters telling patients how many GP days are lost every year because of “do not attends” (DNAs).

But a small project in Bedfordshire managed to cut the inattendance rate by up to 30 per cent by jettisoning those ideas.

Instead, patients were asked to write down when their appointment was, rather than the receptionist doing it, and repeat back to them out loud the details.

Posters were also put up at the two participating GP surgeries, and messages run on digital tickers, saying: “Ninety-five per cent of people turn up to their appointments on time.”

Steve Martin, director of Influence at Work, a behavioural science consultancy, said the psychology of negative messages was all wrong.

He said: “The vast majority of practices and hospitals tend to have these posters that point out how many people don’t turn up. But that just makes people think it’s normal not to attend.”

 

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Nudge blog reader and father Andrew Luccasen reads a bedtime story to his children with a nice behavioral lesson about the wisdom of a commitment device when facing a self-control problem. The story is called “Cookies” from “Adventures of Frog and Toad”  by Arnold Lobel, which was originally published in “Frog and Toad Together” in 1971. “I guess it’s never too early to teach children about cognitive biases and how to attempt to overcome them!” he writes. Here is Luccasen’s account of “Cookies.”

After eating many cookies that Toad baked, Toad and Frog decided they needed to stop. First they agreed to eat one last cookie… then one very last cookie. Having recognized their self-control problem, the friends then seek a commitment device.

Frog puts cookies in a box, but Toad points out that they could just open the box. Frog ties a string around the box, but Toad says they can cut the string. Frog gets a ladder and places the box on a high shelf, but Toad climbs the ladder, cuts the string, and opens the box.

Frog finally takes the box outside of his house, and gives them to the birds in his yard. Frog comments that they “…have lots and lots of willpower.” Toad decides he does not want willpower, and goes home to bake a cake.

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The NYT reports that only 49 percent of CVS ExtraBucks rebate coupons (free money!) are redeemed by customers. CVS wants this number to go up so it is launching “a humorous effort” to discourage “money trashers” from throwing away their ExtraBucks, which are printed at the bottom of their CVS receipts.

Does CVS really need to spend money on this kind of a campaign? The problem seems to be primarily about the placement of the ExtraBucks coupon, the coupon’s graphic design, and the ease with which someone can separate the coupon from the receipt itself (currently, the receipt has no perforation like some of the coupons you would find in weekly circulars). ExtraBucks accrue to ExtraCare customers who have already signed up for the program and swipe their card at the scanner every time they make a purchase in order to get the discount. Lack of awareness hardly seems to be the problem.

The Times reports that the marketing campaign is being rolled out alongside a coupon redesign that uses larger print and a “more eye-catching design.” Early results are “encouraging,” according to CVS, which says it noticed an increase of 5 percent in redemptions.

Now that the two are being rolled out together, disentangling which piece is responsible for the uptick redemption won’t be possible. This seems like a clear case where smart experimental design could help CVS assess the cost effectiveness of 1) A “money trasher” marketing campaign, 2) Various choice architecture changes to the delivery of ExtraBucks, and 3) A combination of a marketing campaign and choice architecture changes. Based on this current strategy, it’s doubtful CVS will be able to say much about the various tactics with any certainty. Too bad.

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Cass Sunstein is busy working for the Obama administration and Richard Thaler is currently consulting to the coalition government in the UK. This post expresses the independent thoughts of the Nudge blog’s applied behavioralist John Balz.

Where behavioral science meets up with public policy, politics is not far behind. That is the implicit takeaway from the recent House of Lords report’s conclusion that effective policies to change behavior need to use a variety of interventions including traditional financial incentives, regulations, and yes, behavioral nudges.

This is an unsurprising conclusion. You would be hard pressed to read Nudge and conclude that the world’s most complex problems like climate change and obesity are to be solved with a single behavioral tool, or even a group of them. Together, preliminarily successfully behavioral interventions like Opower’s utility statement along with preliminarily less successful interventions like calorie count displays in New York City restaurants underscore the importance of social contexts, evidence-based policy, and further research. Applied behavioral science is an emerging field of innovation, which requires experimentation and failure. Policymakers who are looking for guarantees of success should, to use a favorite word from Nudge, opt-out of the arrangement.

Like other catchy phrases, “nudging” has taken on a life of its own in popular discourse, which is always a double-edged sword. This is evident in the differing accounts of the term’s meaning that government officials offered the committee. Ultimately, the committee settled on describing nudges (p.12 of the report) as interventions that “prompt choices without getting people to consider their options consciously, and therefore do not include openly persuasive interventions such as media campaigns and the straightforward provision of information” – a description that satisfies the committee, but not necessarily a room full of behavioral scientists.

In the blogosphere, Liam Delaney acutely points out that popularization has led many to focus on the term nudge “rather than the core ideas,” and in the process “obscures the really important set of ideas emerging in behavioral economics, very few of which are spoken about in the document.” To the House of Lords committee, nudging is the raw, narrow application of non-regulatory interventions of which there appear to be four (1. Provision of information – although it somehow can’t be “openly persuasive”; 2. Changes to physical environment; 3. Changes to the default policy; and 4. The use of social norms and salience). To an applied behavioral scientist, nudging is part of a broader application of behavioral science principles, which can be understood as an engagement with how a boundedly rational decision maker with a heterogeneous set of material and non-material preferences interacts with the world around them. At such an abstract level, you can understand a policymaker’s desire to quickly descend to the ground. Great. Now how can I apply this to my program?

Policymakers who work with behavioral scientists to identify particular behavioral problems (e.g. Why don’t people save more in their retirement accounts? Why do people fail to take advantage of a social program they’ve started to apply to?) and understand how and why they form are the ones most likely to benefit from behavioral insights – in combination, of course, with other traditional insights. So are those where considerable thought is given to questions about the scalability of a particular behavioral solution. Skipping ahead to technical solutions in the form of handy lists of nudges may be tempting, but is likely to lead to unsatisfactory results.

There is also a much bigger political debate going on in the background of these conversations. Is behavioral science a challenge to the regulatory state or a supporter of it? Is it ideologically left, right, or center? When is a nudge a shove? What constitutes “voluntary”? Are behavioral policies transformative or cute and tiny? Perhaps you think applied behavioral scientists should grapple with these questions. Or perhaps you think they are largely irrelevant to the particular problems and policymakers who work in partnership with them. Like other political debates, these are philosophical ones that can go in circles without reaching clear resolutions. That’s fine. Individual societies with differing social and cultural values will settle on answers to their own level of satisfaction. Either way, applying behavioral science is not a mandate, it is a choice. The applied behavioral scientists and those who would like to engage with them, in the public and private sectors, should (and hopefully will) continue to do so with an openness to scientific experimentation, a commitment to rigor, and an expectation of realism.

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From the latest Economic View column:

Social Security may be the most beloved of all the government’s programs, partly because it requires so little thinking. You pay taxes while you work, then you and your spouse collect until you die. This description oversimplifies things, of course. Social Security, as it’s currently constituted, is refreshingly straightforward but you do have to make one important choice, and many people could make their lives after retirement better if they chose differently.

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A recent trip to the Sistine Chapel prompted a Nudge blog reader named David to write us. The museum ushers, he noticed, spend a lot of time barking at visitors about prohibitions on photography in the Chapel. Is there a better way to nudge visitors to keep their cameras and phones down?

The chapel is almost at the end of the Vatican Museum, which contains hundreds of artifacts, paintings, and sculptures that one can spend hours exploring. Visitors are allowed to bring cameras and video cameras into the museum (and about 70% do by my estimate) and take photos and videos of anything contained within – until they get to the Sistine Chapel.

Once at the entrance to the famous chapel, visitors are instructed to keep quiet and take no photos or videos inside. Inside, the chapel lives up to its fame and praise, but every 30-40 seconds a museum worker shouts, “No photo! No video!” I understand the flash may damage the paintings and they sell photos and DVDs in the gift shop, but they don’t sell any with the visitor in them, and those for sale certainly aren’t as re-sizable or sharable as a digital photo. A flash is not needed to take a good photo – there is ample natural light.

For most visitors (I would guess) this is a once-in-a-lifetime journey and to be able to take unlimited photos and videos in the hours of strolling through the museum, then to get to the most famous part and be prohibited from doing so, is at least puzzling. So most don’t obey and click away. Thus the constant “No photo! No video!” shouts by surely-hoarse-by-the-end-of-the-day workers.

Is there something that could nudge people into not taking photos or videos at the Sistine Chapel without the constant reminder that does not deter most? Checking cameras & video equipment into a locker would lead to an awful wait to get into the chapel. I find it ironic that the third rule of the chapel (quiet please) is largely adhered to by the visitors, but broken every 30-40 seconds by the workers in the hopeless attempt to enforce the first two rules!

Or is the nudge really the posting of signs and the issuance of verbal warnings in recognition of the fact that (staff) can’t stop everyone, but can nudge a few percent into not taking them?

David’s (unauthorized, but flash-free) photo of the scene shows visitors pointing and shooting.

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