Yesterday I attended an event at IPPR about the role of behavioural economics in public policy. Director of the Behavioural Insight Team, David Halpern, was the main speaker, and the panel include Gerry Stoker, Daniel Read and Claudia Hammond.
Some highlights:
Background: Whatever your critiques of behavioural insight, let's not forget that it is an achievement to have started at all. We have moved from 'should we do this?' to 'How should we best do this?' which is a big step forward.
Role in economic growth. It sounds like the Behavioural insight team are thinking of how behavioural insights might kick-start the economy. Halpern was quite careful not to disclose things prematurely, but it did sound like he believed there were many ways that economic activity could be promoted/supported with behavioural insight-a lot of it seemed to be about reducing the 'hassle' of transactions, so watch this space.
Message Framing: Don't say: We will insulate your home for free. Nobody wants that(too much hassle) Do say: We will clear out your loft for free. Everybody wants that(the same thing, but reframed).
Social trust: I think I knew this already, but I was struck by the fact that in response to the question(need to check exact wording): "Do you think people can generally be trusted", only about 30% of British people agree, and the evidence suggests there is no good reason for people to feel this way. As Halpern put it: "We drastically underestimate our fellow citizens." Moreover, in relatively deprived areas, people see each other more AND distrust each other more, so it's not simply a function of not knowing people. Halpern added an interesting historical perspective about Anglo Saxons "using their wealth to escape from the inconvenience of dealing with other people."
Indifference and the limits of Nudge: More on this later, but a key point from Daniel Read is that nudge tends to work best on issues that we don't care too much about. So organ donation and pensions sound like big issues, but actually they don't matter that much in terms of immediate desires. He added that the deeper problems relating to climate change and obesity etc (what we call 'adaptive challenges' in our recent report) arise because people basically want things that are not in their interest or the broader social interest. Nudge works when we are moved along our 'indifference curves' as he put it in economic language, but doesn't really change what we want.
What is behaviour? More on this later too, but I asked a question about the theoretical underpinnings of behaviour and how this plays out in policy terms. Behaviour can be framed in many ways, e.g. in terms of agency, stimulus response, goal seeking etc. Halpern conceded that the current approach basically was behaviourist and outcome focussed, and Read seemed to think this was right. But Gerry Stoker seemed to have a much bigger interest in what follows from viewing behaviour in terms of agency- because then your responsibility to help people understand their own behaviour, rather than just changing it for them, comes to the fore. Again, all of this is in our recent report.
Peter Roberts
10th November 2011
Well it is Japan, Russia and the UK who are arguing for any decisions to be delayed until 2018 or 2020 and I hardly think they are doing this for the benefit of less developed economies.
I appreciate comparative economics probably isn't even taught to undergraduates these days but couldn't someone whisper in the ears of the behavioural economists that concentrating on promoting economic growth might not actually be the best use of their talents...
Peter Roberts
10th November 2011
Well it is Japan, Russia and the UK who are arguing for any decisions to be delayed until 2018 or 2020 and I hardly think they are doing this for the benefit of less developed economies.
I appreciate comparative economics probably isn't even taught to undergraduates these days but couldn't someone whisper in the ears of the behavioural economists that concentrating on promoting economic growth might not actually be the best use of their talents...
Jonathanrowson
10th November 2011
Hi Peter,
On 2. I partly agree. I think Clive Hamilton is right when he calls it 'growth fetishism', and the entire system depends on the importance of the premise that economic growth is the goal. However, it is easier to say that in a developed country when you have a job.
On 3. I guess it depends on your loft!
On 4. I think it is much more to do with denial and inertia than selfishness or stupidness. As Nietzsche once put it: 'Man has no ears for that to which experience has given him no access.'
Peter Roberts
10th November 2011
Comments:
2. Role in Economic Growth. The IEA's World Energy Outlook was released yesterday. It sets out why we only have 5 years at most to stop irrervisible global warming. We don't need economic growth, we need economic retreat - as James Lovelock made very plain at his RSA lecture last year. Who is doing the / any work on nudging our political and economic leaders into doing that?
3. Message framing. If somebody told me they were going to clear out my loft for free, I'd assume they hoped there would be something of value they could steal. That links with 4. Social trust, where I would personally say that most people can be trusted - but not in my loft.
4. Indifference and limits of Nudge. I suggest Politicians and business leaders don't care about the big (biggest?) issue of climate change because they know damn well they can ensure the survival of themselves and their families. They want money because it is in their interest but couldn't care less about the rest of us. (It can't just be because they are staggeringly stupid.)