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Effective Decisions: Governments and Businesses Attempt to Persuade by ‘Nudging’
How can you make better decisions?
Psychologists and Economists are particularly interested in how to answer that question and have studied possible decision-making strategies and their effectiveness as far back as the 1950’s.
About 15 years ago, behaviorial theories came together with a simple technique for positively influencing and helping others to make good decisions. It’s called Nudging and was described in a book by Cass Sunstein and Richard Thaler.
Governments have adopted ‘nudging’ techniques to encourage citizens to vote and pay their tax no time. Businesses have adopted it to help make better strategic decisions and to more effectively market their products. Nudging is an attempt to create change by getting people to understand why some decisions are likely better than others.
Sunstein and Thaler define a nudge as “any aspect of the choice architecture that alters people’s behavior 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.”
Nudging is a bit like commentator spin. It generally involves presenting the possible choices that are available and presents evidence and arguments for the pros and cons of the different alternatives, but the evidence is presented in a way that promotes one behavior, the preferred behavior, over the options. The idea is that freedom of choice isn’t restricted — all options still remain on the table.
The six principles of nudging include:
- Provide incentives which could be either material or psychological
- Provide information about all alternatives and how they compare
- Describe what happens by default, if no decision is made. People often can’t decide. Making the preferred nudge option the default is often a good plan.
- Devise a way to provide feedback for how a person’s choice has made a change.
- Expect that the preferred nudge choice will not always be made
